The role of central banks in the context of the Markets in Crypto-Assets Regulation (MiCAR)

Abstract This article examines the role played by EU central banks in the context of Regulation (EU) 2023/1114 (MiCAR), honing in on their involvement vis-à-vis stablecoins e-money tokens (EMTs) and asset-reference tokens (ARTs). It explores the defining characteristics of EMTs and ARTs in order to emphasize the specific risks central banks should be concerned about. The article analyses the goals MiCAR pursues to fully understand the nature of the contribution that central banks must provide to the competent supervisory authority to eventually ensure a sound market for crypto-assets. It argues that the engagement of central banks should not be characterized as mere power, but rather amounts to an actual responsibility that entails, in specific circumstances, the duty to act on their own initiative and irrespective of requests from the competent supervisory authority. The article provides a structured and comprehensive study on ‘when’ and ‘how’ central banks should intervene and issue an opinion. It puts forward a systematic analysis of the responsibility of the central banks vis-à-vis the risks posed to financial stability and monetary policy/sovereignty, as well as to the smooth functioning of the payment system, also summarizing the findings by means of a practical ‘traffic-light’ scheme. Finally, the article deals with the relationship between the competent supervisory authority and central banks in the quest to clarify their respective roles and responsibilities.