{"id":73377,"date":"2026-06-01T05:51:43","date_gmt":"2026-06-01T05:51:43","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/bitgo-ceo-warns-europes-mica-rules-could-trigger-a-massive-stablecoin-crisis\/"},"modified":"2026-06-01T05:51:43","modified_gmt":"2026-06-01T05:51:43","slug":"bitgo-ceo-warns-europes-mica-rules-could-trigger-a-massive-stablecoin-crisis","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/bitgo-ceo-warns-europes-mica-rules-could-trigger-a-massive-stablecoin-crisis\/","title":{"rendered":"Bitgo CEO Warns Europe&#8217;s MiCA Rules Could Trigger a Massive Stablecoin Crisis"},"content":{"rendered":"<p><b>(Originally posted on : Bitcoin News )<\/b><br \/>\n<\/p>\n<div>\n<div class=\"@container mb-[25px] rounded-sm overflow-clip py-0.5 pr-0.5 pl-2.5 bg-success-100\">\n<div class=\"flex flex-col gap-m overflow-clip rounded-[6px] !bg-success-10 p-3 @[420px]:p-m\">\n<h2 class=\"m-0 flex items-center gap-s text-[19px] !text-[#1c1c1c] md:text-[20px]\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"16\" height=\"10\" viewbox=\"0 0 16 10\" fill=\"none\" class=\"shrink-0 text-success-100\" aria-hidden=\"true\"><path d=\"M1 1.5h14\" stroke=\"currentColor\" stroke-width=\"2.5\" stroke-linecap=\"round\"\/><path d=\"M1 8.5h10\" stroke=\"currentColor\" stroke-width=\"2.5\" stroke-linecap=\"round\"\/><\/svg><span>Key Takeaways<\/span><\/h2>\n<ul class=\"m-0 flex list-none flex-col gap-m pl-0\">\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">Mike Belshe warns MiCA limits insurance to \u20ac100K, creating system-wide risks for European stablecoins.<\/span><\/li>\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">Recalling how 1 SVB failure depegged USDC in 2023, Belshe warns the banking sector can crash crypto.<\/span><\/li>\n<li class=\"m-0 flex items-start gap-s !text-[#434248]\"><span class=\"mt-2 size-2 shrink-0 rounded-full bg-success-100\" aria-hidden=\"true\"\/><span class=\"text-body\">Bitgo\u2019s CEO demands better rules to protect billion-euro stablecoin reserves from bank collapses.<\/span><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<h2>Bitgo CEO States MiCA Brings Systemic Risks to <span>Stablecoin<\/span> Issuers<\/h2>\n<p>Mike Belshe, CEO of Bitgo, one of the largest custody providers in the <span>crypto<\/span> industry, believes that current <span>cryptocurrency<\/span> regulation in Europe might contribute to a potential <span>stablecoin<\/span> debacle.<\/p>\n<p>On social media, Belshe <a href=\"https:\/\/x.com\/mikebelshe\/status\/2060844840058016190?s=20\" target=\"_blank\" rel=\"noopener noreferrer\">explained<\/a> that the Markets in <span>Crypto<\/span> Assets (MiCA) regulation exposes the <span>stablecoin<\/span> ecosystem in Europe to systemic risks, forcing <span>stablecoin<\/span> issuers to hold reserve balances in traditional banks that follow fractional reserve standards.<\/p>\n<p><strong style=\"--tw-border-spacing-y:0;--tw-translate-x:0;--tw-translate-y:0;--tw-rotate:0;--tw-skew-x:0;--tw-skew-y:0;--tw-scale-x:1;--tw-scale-y:1;--tw-scroll-snap-strictness:proximity;--tw-ring-offset-width:0px;--tw-ring-offset-color:#fff;--tw-ring-color:#3b82f680;--tw-ring-offset-shadow:0 0 #0000;--tw-ring-shadow:0 0 #0000;--tw-shadow:0 0 #0000;--tw-shadow-colored:0 0 #0000\"><\/strong><\/p>\n<p><strong>\u201cThat creates a direct link between cryptomarkets and traditional banking stress. When a bank wobbles, <span>stablecoin<\/span> reserves wobble with it,\u201d<\/strong> Belshe stated, clarifying that this was possible as <span>stablecoin<\/span> issuers would be subject to the same insurance as a retail customer.<\/p>\n<p><strong>\u201cEU deposit insurance caps at \u20ac100K per depositor. A <span>stablecoin<\/span> issuer holding billions in reserves gets the same protection as a retail savings account. That\u2019s not a rounding error \u2014 it\u2019s a structural gap,\u201d <\/strong>Belshe stressed.<\/p>\n<p>The U.S. has already experienced a similar episode to the one Belshe described, when a failure of the traditional fiat system bled into <span>crypto<\/span>. Circle, issuer of the USDC <span>stablecoin<\/span>, was affected by the <a href=\"https:\/\/news.bitcoin.com\/us-regulators-close-silicon-valley-bank-in-one-of-the-largest-bank-failures-since-washington-mutual\/\">closure<\/a> of Silicon Valley Bank (SVB) in 2023, as the company held $3.3 billion backing its <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-are-stablecoins\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">stablecoin<\/a> in the bank. This caused a depeg in its market pricing, affecting <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-is-defi-decentralized-finance\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">decentralized finance<\/a> and rippling into lending protocols as well.<\/p>\n<p>Nonetheless, at the time, the Federal Reserve backstopped all the deposits and made all customers whole, including Circle, which moved their funds to BNY Mellon shortly afterwards.<\/p>\n<p>Belshe reinforced the need to get regulation right in this regard, as failing to do so would open the doors for a similar event affecting <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-are-stablecoins\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">stablecoin<\/a> issuers in Europe.<\/p>\n<p><strong>\u201cThe U.S. got lucky in 2023. Europe may not. Proper <span>stablecoin<\/span> regulation means thinking through the entire failure chain \u2014 not just who holds the reserves, but what happens when the institution holding them breaks,\u201d<\/strong> he concluded.<\/p>\n<\/p><\/div>\n<p><a href=\"https:\/\/news.bitcoin.com\/bitgo-ceo-warns-europes-mica-rules-could-trigger-a-massive-stablecoin-crisis\/\">Source link <\/a><br \/>\n<br \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Originally posted on : Bitcoin News ) Key Takeaways Mike Belshe warns MiCA limits insurance to \u20ac100K, creating system-wide risks for European stablecoins. Recalling how 1 SVB failure depegged USDC in 2023, Belshe warns the banking sector can crash crypto. Bitgo\u2019s CEO demands better rules to protect billion-euro stablecoin reserves from bank collapses. Bitgo CEO [&hellip;]<\/p>\n","protected":false},"author":15,"featured_media":73378,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[32],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/73377"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=73377"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/73377\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/73378"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=73377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=73377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=73377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}