Comparative Analysis of Stablecoin Regulatory Frameworks: EU, UAE, and Singapore

In recent years, with the rapid development of the cryptocurrency industry, stablecoins have received significant attention from regulatory agencies in various countries as an important type of crypto asset. This article will conduct a comparative analysis of the stablecoin regulatory frameworks in the EU, UAE, and Singapore, aiming to provide readers with a comprehensive perspective.

I. European Union

1. Regulatory processes and normative documents

The European Union officially released the "Regulation on Markets in Crypto-Assets" (MiCA) on June 2023, (, aiming to establish a unified regulatory framework for crypto assets. The rules regarding the issuance of stablecoins in this regulation will come into effect on June 30, 2024.

) 2. Regulatory authorities

The European Banking Authority ### EBA ( and the European Securities and Markets Authority ) ESMA ( are responsible for establishing the regulatory framework and supervising significant stablecoin issuers and related service providers. National competent authorities also possess some regulatory powers.

) 3. Main contents of the regulatory framework

a. Definition of stablecoin

The MiCA regulation divides stablecoins into two categories:

• Electronic currency token ### EMT (: A type of crypto asset that stabilizes its value by referencing only one official currency.
• Asset reference token )ART(: A cryptocurrency that stabilizes value by referencing a combination of the values of one or more official currencies.

Algorithmic stablecoins are not included in the regulatory framework, which effectively means they are banned.

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)# b. Admission threshold for issuers

There are two types of ART issuers:

1. A legal entity or enterprise established and authorized in the European Union.
2. Qualified lending institutions.

MiCA adopts a tiered regulatory model, setting different access thresholds and regulatory requirements based on the average circulation value of ART.

c. Stablecoin value stabilization mechanism and maintenance of reserve assets

• Issuers must always maintain reserve assets to cover risks and meet redemption demands.
• Reserve assets must be completely segregated from the issuer's own assets and independently custodied by a third party.
• Reserve asset investments must meet conditions such as low risk and high liquidity.

d. Compliance requirements for circulation.

• ART holders have the right to redeem at any time.
• Set a limit on the maximum circulation of ART.

e. Important special regulatory rules for ART

ART that meets specific criteria is classified as important ART, and its issuer must undertake additional obligations.

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2. United Arab Emirates

) 1. Regulatory processes and normative documents

In June 2024, the Central Bank of the UAE issued the "Payment Token Service Regulations", clarifying the definition and regulatory framework of "payment tokens" ### stablecoin (.

) 2. Regulatory authorities

The UAE adopts a "federal-Emirate" dual-track parallel regulatory system. The UAE Central Bank is responsible for regulation at the federal level, but this does not include the two financial free zones, DIFC and ADGM.

3. Main content of the regulatory framework

a. Definition of stablecoin

The regulation defines stablecoin as: "A virtual asset intended to maintain a stable value by referencing the value of a fiat currency or another stablecoin priced in the same currency."

b. Issuer's access threshold

Applicants must meet the legal form requirements, initial capital requirements, and provide necessary information and documents.

c. The mechanism for stabilizing coin value and maintaining reserve assets

• The issuer must establish an effective system to manage reserve assets.
• Reserve assets must be held in cash form in a separate custody account.
• The value of reserve assets must be at least equal to the total face value of the legal currency of the circulating stablecoins.
• Require a monthly external audit.

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)# d. Compliance requirements in the circulation process

• Stablecoins are only used as payment tools and are not allowed to earn interest.
• Holders can redeem at any time without restrictions.
• Issuers must comply with anti-money laundering/anti-terrorist financing regulations.
• Require protection of users' personal information.

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3. Singapore

) 1. Regulatory processes and normative documents

• The Payment Services Act was introduced in December 2019.
• Released the "stablecoin regulatory framework" in August 2023.

2. Regulatory authorities

The Monetary Authority of Singapore ### MAS ( is responsible for regulation.

) 3. Main contents of the regulatory framework

a. Definition of stablecoin

The "Stablecoin Regulatory Framework" only regulates single-currency stablecoins issued in Singapore that are pegged to the Singapore dollar or G10 currencies.

b. Admission threshold for issuers

Applicants must meet the basic capital requirements, business restriction requirements, and solvency requirements.

c. Stablecoin value stabilization mechanism and maintenance of reserve assets

• Reserve assets are limited to specific low-risk, high-liquidity assets.
• Strict separation of proprietary funds and reserve assets is required.
• The market value of reserve assets must be higher than the circulation scale of stablecoins.

d. Compliance requirements in the circulation link

The issuer must fulfill the statutory redemption obligation, redeeming the holder's stablecoin at face value within five working days.

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