EU watchdog proposes MiCA crypto penalty framework

The European Banking Authority has released a consultation paper detailing a structured penalty framework for issuers of significant crypto tokens that violate the European Union's Markets in Crypto-Assets regulation. This framework establishes a two-step assessment process to determine fines, which can reach up to 12.5% of annual turnover for asset-referenced token issuers and 10% for e-money token issuers. These measures are designed to ensure standardized enforcement across the bloc as the July 1 deadline for MiCA licensing approaches. The proposal highlights the increasing regulatory pressure on stablecoin and token issuers, as evidenced by Binance recently restricting services for EU users after failing to secure necessary authorizations. By quantifying potential financial consequences, the EBA aims to create a more predictable and rigorous compliance environment for digital asset firms. This development is critical for the RWA market, as it provides the legal clarity and enforcement mechanisms necessary for institutional-grade tokenized assets to operate within the EU. The consultation period remains open until September 28, marking a significant step toward full implementation of the MiCA regulatory regime.