The European Commission has opened a formal comment period that will shape the next iteration of the European Union’s Markets in Crypto Assets (MiCA) regulatory framework, widely referred to as MiCA 2.0. The consultation, launched in May 2026, invites industry participants, legal experts, and consumer advocates to weigh in on revisions to stablecoin requirements, the inclusion of decentralized finance (DeFi) platforms, and the regulatory status of prediction markets. The comment period closes on August 31, 2026.
MiCA 1.0 set a global benchmark; MiCA 2.0 aims to refine it
Full enforcement of MiCA began on December 30, 2024, with the first licenses issued in early 2025. The framework gave the EU a first-mover advantage in comprehensive crypto regulation, ahead of the United States. Katie Harries, director and head of policy for Europe at Coinbase, described MiCA as an “important first move” that created a “single, harmonised rulebook for crypto” across member states, providing consumer protections and regulatory clarity that allowed firms like Coinbase to expand into retail and institutional markets across the bloc.
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Now, Brussels is recalibrating. The consultation is divided into four parts: scope and definitions for crypto assets other than asset-referenced tokens (ARTs) and e-money tokens (EMTs); requirements for EMTs, ARTs, and their issuers; a legal framework for crypto-asset service providers (CASPs) not covered by MiCA 1.0, including DeFi platforms; and prediction markets.
Stablecoin rules under scrutiny
Part two of the consultation, covering stablecoins, is described by Catarina Veloso, director of regulatory and compliance at Notabene, as the “longest and arguably the most politically charged section.” The regulatory treatment of stablecoins hinges on how they are used. If treated primarily as crypto trading instruments, the focus remains on investor protection and market integrity. If treated as payment infrastructure, then redemption rights, reserve management, liquidity, operational resilience, and supervisory reporting become central.
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Coinbase’s Harries noted that MiCA 2.0 could “make euro stablecoins more competitive by recalibrating rules around reserves, rewards and the multi-issuance model.” She suggested that allowing a greater share of stablecoin reserves to be held in high-quality sovereign assets could reduce risk without compromising safety. Another key issue is the prohibition on EMT issuers offering interest. Veloso warned this “can weaken the competitiveness of euro-denominated stablecoins and push users either toward foreign-currency stablecoins or toward yield structures outside the regulated perimeter.” Harries added that MiCA should permit non-interest incentives such as cashback and loyalty programs, which are standard in payments and drive competition.
Defining decentralization for DeFi
MiCA currently exempts CASPs that are fully decentralized and operate without any intermediary. Veloso noted that “decentralisation is rarely binary.” Regulators must determine what indicators matter: control over the protocol, governance rights, admin keys, front-end control, revenue capture, upgradeability, or the ability of identifiable persons to influence outcomes.
Miroslav Đurić, a senior associate at Taylor Wessing, explained that many CASPs already connect clients with DeFi platforms. Since these platforms are exempt from MiCA, regulators are asking whether CASPs should conduct due diligence on the DeFi platforms they make accessible. “The Commission appears to be ready to explore different approaches, including some that might only permit CASPs to connect their clients with DeFi platforms that are certified under some new certification regime,” Đurić said.
Prediction markets face regulatory uncertainty
Prediction markets currently lack a unified EU regulatory structure and are banned in some member states. The Commission is seeking feedback on whether these markets offer economic benefits for consumers and whether they fall under MiCA or the Markets in Financial Instruments Directive (MiFID II). Đurić said the answer depends on the nature of the contracts. “Depending on the event contracts available on the platform, a platform operator can easily become subject to requirements stipulated under different, sometimes conflicting regulatory frameworks: ranging from MiFID II over gambling to MiCA.”
What comes next
Industry observers emphasize the importance of continued dialogue with Brussels. Harries said an effective MiCA 2.0 will require “dialogue between industry, policymakers and regulators, learning from how the framework is working in practice and refining areas where greater clarity or flexibility can help support the next phase of growth across the region.”
The comment period ends on August 31, 2026, but Đurić cautioned that the legislative process could take years. “Given the level of complexity of the points raised in the consultation as well as the usual pace at which the EU legislative process moves, it is hardly expectable that any concrete legislative proposals will be adopted before 2028.”
FAQs
Q1: What is MiCA 2.0?
MiCA 2.0 is the expected next iteration of the EU’s Markets in Crypto Assets regulation. It will revise and expand the original framework, which took full effect in December 2024, to address areas not covered in MiCA 1.0, including DeFi, stablecoin rules, and prediction markets.
Q2: Why is the EU revising stablecoin rules?
The EU is seeking to make euro-denominated stablecoins more competitive by potentially allowing a greater share of reserves in sovereign assets and permitting non-interest incentives like cashback and loyalty programs, which are currently prohibited for e-money token issuers.
Q3: When will MiCA 2.0 take effect?
The European Commission’s consultation closes on August 31, 2026, but legal experts estimate that concrete legislative proposals are unlikely to be adopted before 2028, given the complexity of the issues and the typical pace of EU lawmaking.
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