EU: Stablecoins are gradually evolving from a technical tool for cryptocurrency traders into one of the most important topics in global finance. That’s precisely why regulators on both sides of the Atlantic now want to focus on them even more closely. The European Banking Authority EBA and the New York State Department of Financial Services, the financial regulator for New York State, have signed a memorandum of cooperation on supervision of cross-border activities related to stablecoins.
The agreement is intended to enable better information exchange between the European Union and New York, which is one of the world’s most important financial centers. Regulators will share data on which stablecoins specific companies issue, how many are in circulation, and how many holders they have. The shared information will also include results of internal and external audits, regulatory status of individual products and services, and information about potential risks.
Article contents:
What are stablecoins and why regulators are addressing them
A stablecoin is a type of cryptocurrency that attempts to maintain a stable value. Most commonly it’s pegged to the US dollar, so one token corresponds to one dollar. In practice, stablecoins are used in trading on cryptocurrency exchanges, in decentralized finance, and for fast cross-border transfers.
However, their significance is growing beyond the traditional crypto world. Banks and major financial institutions in both the United States and Europe are already testing the use of stablecoins for payments. This is aided by the fact that clearer rules for this type of digital asset have emerged in both the US and the European Union.
According to DefiLlama data, the value of the global stablecoin market exceeded $319 billion on Wednesday. The largest share of activity continues to come from stablecoins pegged to the US dollar. The biggest players by market capitalization remain Tether with its USDT and Circle with the USDC token.
Agreement emerges under European MiCA regulation
The European Banking Authority stated that the memorandum falls under its obligations according to the European MiCA regulation, or Markets in Crypto-Assets Regulation. This brought the European Union a more unified framework for supervision of crypto-assets and, since the end of 2024, has become the key foundation of European crypto regulation.
The agreement between EBA and NYDFS establishes principles and procedures for information exchange, supervision coordination, monitoring market trends, and evaluating risks. The New York regulator stated that the cooperation is meant to strengthen oversight of entities involved in stablecoin activities, help identify trends and risks, and support the integrity of the stablecoin market.
This is therefore not just a formal signature between two authorities. Regulators are creating a channel through which they can share information more quickly in a situation where a stablecoin issued or used in one jurisdiction can have an impact on users, companies, and markets in another part of the world.
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Regulators will monitor volume, holders and audits
The memorandum anticipates a fairly broad range of information. EBA and NYDFS can share, for example, data on issued stablecoins, total volume in circulation, number of holders in both custodial and unhosted wallets, or about the reserves that are supposed to back the stablecoin.
Audits are also important. The question of whether stablecoins are truly sufficiently backed and whether their value can be trusted has long been among the most sensitive topics in the entire sector. Regulators should therefore have the ability to exchange results of external and internal audits, information on liquidity, reserves, own resources, risk management, security measures, and any sanctions or investigations.
The agreement also anticipates coordination in crisis situations. If, for example, a major stablecoin issuer were to face serious operational or financial problems, or a major cyber incident, both parties can more quickly share information and attempt to coordinate a response.
Oversight won’t cover absolutely everything
However, the memorandum also has clear boundaries. Regulators will not monitor all activities of companies that work with stablecoins. The agreement only applies to stablecoin activities of entities that fall under the supervision of one or both parties.
This is especially important for companies that, in addition to stablecoins, are also involved in other parts of the crypto market, such as exchange trading, asset management, or technology services. The goal of the agreement is not to broadly control their entire business, but to better supervise those parts that can impact stablecoin holders and broader financial markets.
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Both the US and Europe want stablecoins under control
The agreement comes at a time when stablecoins are moving to the center of attention for regulators and traditional financial institutions. US President Donald Trump signed stablecoin legislation, the GENIUS Act, in July 2025, which created a federal framework for payment stablecoins in the United States. Meanwhile, the European Union has put into practice its MiCA framework, which became the first comprehensive European regime for crypto-assets.
Both regulations have a common goal: to bring the rapidly growing market for digital tokens pegged to traditional currencies into an environment where there will be clearer rules for issuers, reserves, supervision, and user protection.
Stablecoins are simple at first glance, but in reality they can be systemically sensitive. If people believe that one token has a value of one dollar, they must be assured that there are truly sufficient reserves behind this value and that in case of problems it will be possible to exchange the tokens back.
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