Germany -- Stablecoin Regulations Regulatory Overview

Germany regulates stablecoins primarily under the EU's Markets in Crypto-Assets Regulation (MiCA, Regulation (EU) 2023/1114), effective for stablecoin provisions since June 30, 2024, alongside national laws like the German Banking Act (KWG) and Payment Services Supervision Act (ZAG), with the Federal Financial Supervisory Authority (BaFin) as the lead supervisor.[1]

Classification

Stablecoins are classified as crypto assets under MiCA, specifically as e-money tokens (EMTs) if referencing a single fiat currency (e.g., euro) or asset-referenced tokens (ARTs) if backed by other assets, per MiCA definitions and BaFin's Merkblatt on crypto custody (KWG §1(11) sentence 1 no. 11).[1] They are not inherently treated as securities unless they meet additional criteria under securities laws.

Reserve Requirements

EMTs and ARTs require full backing by high-quality, low-risk assets (e.g., fiat or approved equivalents), with composition specified in European Banking Authority (EBA) Regulatory Technical Standards (RTS); enhanced "add-ons" apply to significant issuers.[1][2] Regular independent audits, attestations, whitepapers, periodic reserve statements, and audited financials are mandatory, with supervisory reporting to BaFin.[1]

Issuer Licensing

Issuers must obtain prior authorization from an EU national competent authority like BaFin, including approval of a mandatory whitepaper detailing risks, business model, and repayment terms.[1][2] As of May 2025, ESMA had authorized 10 issuers for 15 stablecoins (10 euro-pegged, 5 USD-pegged).[2] Crypto-asset service providers (CASPs) handling stablecoins face rules from December 30, 2024.[1] Unlicensed stablecoins face delisting from EU exchanges serving EU customers.[2]

Redemption Rights

Token holders have a legal right to redemption at par value in the referenced fiat currency (1:1), as stipulated in MiCA and issuer whitepapers.[1][2]

Algorithmic Stablecoin Rules

Algorithmic stablecoins are prohibited under MiCA if they lack guaranteed 1:1 coverage by reserves.[2]

CBDC Interaction

No direct restrictions on stablecoin-CBDC interactions are specified, but Deutsche Bundesbank President Joachim Nagel endorsed euro-based stablecoins under MiCA as complementary to a potential retail or wholesale CBDC, promoting efficient cross-border payments while favoring central bank money for institutional settlement.[5] Germany and Italy proposed an EU "kill switch" for non-compliant global stablecoins (e.g., reserve failures or breaches harming EU holders), operable by the European Banking Authority.[3]

Ongoing proposals (as of March 2026) from Germany and Italy seek an EU equivalence regime for multi-issued stablecoins from EU and non-EU entities under MiCA market integration reforms.[4] For full texts: MiCA at EUR-Lex (search Regulation (EU) 2023/1114); BaFin guidance at bafin.de.[1]