Eba CP 1699463275

MiCAR
Public Consultations
Third batch of consultations
requesting input on draft
technical standards and
Guidelines under the
Markets in Crypto-Assets
Regulation (MiCAR)
MiCAR
Reporting of transactions with
asset-referenced tokens and e-
money tokens denominated in a
non-EU currency under MiCAR
Virtual public hearing: 17 January

Deadline for comments: 08 February
MiCAR
Draft regulatory technical standards
on liquidity requirements and on
draft Guidelines on liquidity stress
testing of relevant issuers of tokens
under MiCAR
Hybrid Public Hearing: 30 January

MiCAR
Draft technical standards on
supervisory colleges under the
Markets in Crypto-Assets
Regulation
Virtual Public Hearing: 17 January

MiCAR
Draft Guidelines on recovery plans
for issuers of asset-referenced
tokens and e-money tokens under
MiCAR

MiCAR
Draft technical standards on
own funds requirements and
stress testing of issuers under
MiCAR

EBA/CP/2023/32
8 November 2023
Consultation Paper
Draft Implementing Technical Standards

on the reporting on asset-referenced tokens under Article 22(7) of
Regulation (EU) No 2023/1114 (MiCAR) and on e-money tokens
denominated in a currency that is not an official currency of a
Member State pursuant to Article 58(3) of that Regulation
CP ON DRAFT ITS ON THE REPORTING ON ARTS AND EMTS DENOMINATED IN A NON-EU CURRENCY UNDER
ARTICLE 22(7) AND 58(3) OF MICAR
Contents
1. Responding to this consultation 3
2. Abbreviations 4
3. Executive Summary 5
4. Background and rationale 6
5. Draft implementing technical standards 16
6. Accompanying documents 24
2
1. Responding to this consultation

The EBA invites comments on all proposals put forward in this paper and in particular on the specific
questions summarised in 6.2.
Comments are most helpful if they:

▪ respond to the question stated;
▪ indicate the specific point to which a comment relates;
▪ contain a clear rationale;
▪ provide evidence to support the views expressed/ rationale proposed; and
▪ describe any alternative regulatory choices the EBA should consider.
Submission of responses
To submit your comments, click on the ‘send your comments’ button on the consultation page
by 08 February 2024. Please note that comments submitted after this deadline, or submitted via
other means may not be processed.
Publication of responses
Please clearly indicate in the consultation form if you wish your comments to be disclosed or to
be treated as confidential. A confidential response may be requested from us in accordance with
the EBA’s rules on public access to documents. We may consult you if we receive such a request.
Any decision we make not to disclose the response is reviewable by the EBA’s Board of Appeal
and the European Ombudsman.
Data protection
The protection of individuals with regard to the processing of personal data by the EBA is based
on Regulation (EU) 1725/2018 of the European Parliament and of the Council of 23 October 2018.
Further information on data protection can be found under the Legal notice section of the EBA
website.
3
2. Abbreviations
AMLD Anti-money laundering directive (Directive (EU) 2015/849)

AML Anti-money laundering
ART Asset-referenced token
CA Competent authority
CASP Crypto-asset service provider
CP Consultation paper
CFT Countering financing of terrorism
EBA European Banking Authority
ECB European Central Bank
EU European Union
EMT E-money token
FTR Funds Transfer Regulation (Regulation (EU) 2023/1113)
ITS Implementing technical standards
MiCAR Regulation on markets in crypto-assets (Regulation (EU) 2023/1114)
RTS Regulatory Technical Standards
4
3. Executive Summary
Regulation (EU) 2023/1114 of the European Parliament and of the Council on markets in crypto-
assets (MiCAR)1 was published in the Official Journal of the European Union on 9 June 2023 and
entered into force on 29 June 2023.
Article 22(1) of MiCAR requires the issuer of an asset-referenced token (ART) to report to the com-
petent authority, on a quarterly basis
(a) “The number of holders;

(b) The value of the asset-referenced token issued and the size of the reserve of assets;
(c) The average number and average aggregate value of transactions per day during the rele-
vant quarter;
(d) an estimate of the average number and average aggregate value of transactions per day
during the relevant quarter that are associated to uses [of the ART] as a means of exchange
within a single currency area”.
Article 22(3) of MiCAR requires crypto-asset service providers (CASPs), that provide services related
to ARTs, to provide the issuers of ARTs the information necessary for them to prepare the report
referred to in Article 22(1) of MiCAR.
In support of these provisions, Article 22(7) of MiCAR mandates the EBA to develop draft imple-
menting technical standards (ITS) to establish standard forms, formats and templates for the pur-
poses of reporting by the issuers and CASPs, as referred to in Article 22(1) and (3) of MiCAR.
In accordance with Articles 22(7) and 58(3) of MiCAR, the draft ITS proposed in this Consultation
Paper (CP) apply to both ARTs and e-money tokens (EMTs) denominated in a non-EU currency.
The draft ITS specify the reporting requirements and provide harmonised sets of templates and
instructions for both the issuers and CASPs.
Next steps
The final draft ITS will be submitted to the European Commission for endorsement following which
they will be subject to scrutiny by the European Parliament and the Council before being published
in the Official Journal of the European Union. The EBA will also develop the data point model (DPM),
XBRL taxonomy and validation rules based on the final draft ITS.
1
Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets,
and amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937
(OJ L 150, 9.6.2023, p. 40–205)
5
4. Background and rationale
4.1 Background
1. The Regulation (EU) 2023/1114 of the European Parliament and of the Council on markets in
crypto-assets (MiCAR) regulates the offering to the public and admission to trading of asset-
referenced tokens (ARTs), e-money tokens (EMTs) and other types of crypto-assets, as well as
crypto-assets services provided by crypto-asset service providers (CASPs) in the European Un-
ion (EU). MiCAR entered into force on 29 June 2023, and will apply from 30 December 2024,
except for Titles III and IV regarding the offering to the public and the admission to trading of
ARTs and EMTs, that will apply from 30 June 2024.
2. The objectives of MiCAR are to ensure the proper functioning of markets in crypto-assets, mar-
ket integrity and financial stability in the EU, as well as the protection of holders of crypto-
assets, in particular retail holders2. MiCAR aims to address, in particular, risks that the wide use
of crypto-assets which aim to stabilise their price in relation to a specific asset or a basket of
assets (such as ARTs) could pose to financial stability, the smooth operation of payment sys-
tems, monetary policy transmission or monetary sovereignty3.
3. MiCAR sets out a number of safeguards to address such risks. These include supervisory activi-
ties by the competent authorities (CAs) such as the examination of compliance by the issuers
of ARTs with the reserve of assets4 requirements and in general to monitor the robustness and
significance5 of the tokens issued in the market. It also includes the monitoring by CAs of the
use of ARTs and the possibility for limiting the issuance of these tokens when the volume and
value of transactions associated to uses of these tokens as a means of exchange exceed certain
thresholds (which are set out in Article 23 of MiCAR). Moreover, CAs may limit the issuance of
these tokens where the European Central Bank (ECB) or, where applicable, a central bank re-
ferred to in Article 20(4) of MiCAR, issues an opinion that such tokens pose a threat to the
smooth operation of payment systems, monetary policy transmission or monetary sover-
eignty6.
4. To allow CAs to monitor the use of ARTs and compliance with the reserve of assets require-
ments, Article 22(1) of MiCAR requires the issuer of an ART to report on a quarterly basis to the
CA:
(a) the number of holders;
(b) the value of the asset-referenced token issued and the size of the reserve of assets;
2
See Recital 112 of MiCAR
3
4
See Recitals 54 and 56 of MiCAR
5
6
See Articles 24(3) and 58(3) of MiCAR
6
(c) the average number and average aggregate value of transactions per day during the
relevant quarter; and
(d) an estimate of the average number and average aggregate value of transactions per
day during the relevant quarter that are associated to uses of the ART as a means of
exchange within a single currency area.
5. The above reporting requirements apply for each ART with an issued value that is higher than
EUR 100 million, and for ARTs with a value issued below this threshold, when required by the
CA in accordance with Article 22(2) of MiCAR.
6. To enable issuers to report this information, Article 22(3) of MiCAR requires CASPs that provide
services related to ARTs to share with the issuer the information necessary to prepare the re-
port referred to in Article 22(1), including by reporting transactions that are settled outside the
distributed ledger.
7. To support these provisions, there are several mandates addressed to the EBA:
i. Article 22(7) of MICAR mandates the EBA to develop draft implementing tech-
nical standards (ITS) to establish standard forms, formats and templates for the
purposes of the reporting in Article 22(1), and for the purpose of the reporting
by CASPs to the issuer in accordance with Article 22(3).
ii. Article 22(6) mandates the EBA, in close cooperation with the ECB, to develop
draft regulatory technical standards (RTS) specifying the methodology to esti-
mate “the quarterly average number and average aggregate value of transac-
tions per day that are associated to uses of an ART as a means of exchange
within a single currency area”, as referred to in point (d) of Article 22(1) of
MiCAR. The EBA’s proposals on the draft RTS under Article 22(6) are included
in the separate Consultation Paper (CP) (EBA/CP/2023/31).
The EBA is required to submit these draft technical standards to the Commission by 30 June 2024.
8. In accordance with Article 58(3) of MiCAR, the provisions of Articles 22, 23 and 24(3) shall also
apply to EMTs denominated in a currency that is not an official currency of an EU Member
State. Accordingly, the ITS and RTS mentioned above shall also apply mutatis mutandis to such
tokens. Going forward throughout this CP, when referring to ARTs, EMTs denominated in a
non-EU currency are also covered and included in the scope of tokens for this draft ITS.
9. This CP sets out how the EBA proposes to fulfill the mandate in Article 22(7) by developing this
draft ITS. In the rational section below, the various policy options that have been considered in
the process are explained. Questions have been inserted throughout the document to elicit the
views of external stakeholders.
4.2 Rationale
7
10. This chapter sets out the approach the EBA has taken to develop the draft ITS in respect of the
below topics:
• the objectives of the reporting by issuers of ARTs in Article 22(1) of MiCAR;
• reporting by issuers of ARTs on holders in Article 22(1)(a) of MiCAR;
• reporting by issuers of ARTs of the value of the token issued in Article 22(1)(b) of
MiCAR;
• reporting by issuers of ARTs on the reserve of assets in Article 22(1)(b) of MiCAR;
• the scope and reporting by issuers of ARTs of transactions according to Article 22(1)(c)
and (d) of MiCAR;
• reporting transactions by CASPs according to Article 22(3) of MiCAR;
• data quality and the reconciliation by the issuer of the data reported by CASPs to the
issuer;
• the reporting reference dates and related reporting remittance dates.
The objectives of the reporting by issuers of ARTs in Article 22(1) of MiCAR
11. Article 22(7) mandates the EBA to develop draft ITS to establish standard forms, formats and
templates for the purposes of the reporting in Article 22(1), and for the purpose of the reporting
by CASPs to the issuer in accordance with Article 22(3).
12. In order to assess whether an ART meets the criteria in Articles 43(1) and 56(1) of MiCAR to be
classified as “significant”, the data reported based on Article 22(1) should be used by the CAs.
Significant ARTs due to their larger scale of use and presence in the market are associated with
higher risks, thus they are subject to different supervisory measures, including supervision by
the EBA.
13. It is important to note that the transactions referred to in point (d) of Article 22(1) (that are
associated to its uses as a means of exchange) are the same as the transactions that are subject
to the caps in Article 23(1) of MiCAR. This latter Article limits the issuance of ARTs where “the
estimated quarterly average number and average aggregate value of transactions per day as-
sociated to its uses as a means of exchange within a single currency area is higher than 1 million
transactions and EUR 200 000 000, respectively”. Articles 22(1)(d) and 23(1) should help to
monitor and mitigate risks that the wide use of ARTs as a means of exchange may have on
monetary policy transmission and monetary sovereignty within the EU, through currency sub-
stitution effects.
8
14. Finally, Article 22(1) of MiCAR is the only provision that includes specific, harmonized reporting
requirements for the issuers, and should ensure that CAs receive the information needed to
perform their supervisory and other statutory activities.
Reporting by issuers of ARTs on holders in Article 22(1)(a) of MiCAR
15. Article 22(1)(a) requires issuers to report the respective number of holders related to those
ARTs under the scope of the reporting obligations. The total number of holders of an ART will
be the basis for the significance criteria and for determining which CAs qualify to be members
of a college of supervisors under Article 119(2)(l) (as per the criteria proposed in the related CP
on draft RTS on supervisory colleges under MiCAR, EBA/CP/2023/33). The ITS also include the
breakdowns of holders that are retail holders, holders of custodial wallet and/or holders of
non-custodial wallet7. As described in paragraph 2 of this CP, MiCAR particularly focuses on the
protection of retail holders. Also, considering the different nature of custodial and non-custo-
dial wallets, as described in paragraph 26 of this CP, this breakdown provides useful and nec-
essary information for the CAs to perform their supervisory duties. Furthermore, and in order
to monitor possible concentrations, these breakdowns should be also reported separately for
each relevant country, based on the country of residence of the holder, which is determined
based on the registered office address for legal entities and the habitual residence for natural
persons. This is in line with the EBA draft Guidelines under Regulation (EU) 2023/11138 (the
Funds Transfer Regulation or ‘FTR’).
16. MiCAR requires CASPs to provide the issuers with the necessary information that they need to
report the number of holders. The draft ITS propose that CASPs should prepare a list of the
holders they provide services to and share this list with the issuers of these ARTs. A holder
might have several accounts with different CASPs. According to the draft ITS, when reporting
the number of holders for an ART, each individual holder should be counted only once, regard-
less the number of different accounts the holders possess. To avoid double counting of the
same holders, CASPs should include unique identifier information for each holder, so issuers
can reconcile the lists shared by different CASPs. These unique identifiers should be LEI code,
official tax registration number, national identification number, name(s), depending on the
type of the holder (legal entity or natural person). CASPs should also include in this list infor-
mation whether the holder is retail or non-retail and the country of the holder, so issuers have
all information to complete their templates on holders.
Question 1: Do you agree with the proposal included in the ITS on how issuers and CASPs should
report on holders in Article 22(1)(a) of MiCAR? If not, please provide your reasoning and suggest an
alternative approach.
Reporting by issuers of ARTs of the value of the token issued in Article 22(1)(b) of MiCAR
7
Or holder of any other type of distributed ledger address that is used for settlement purposes and not controlled by a
user or by a crypto asset service provider.
8
Regulation (EU) 2023/1113 of the European Parliament and of the Council of 31 May 2023 on information accompanying
transfers of funds and certain crypto-assets and amending Directive (EU) 2015/849
9
17. Issuers have to report the value of the token issued in accordance with Article 22 of MiCAR.
This value is also necessary to assess the significance of an ART following Article 43 of MiCAR.
If the value of the token issued is higher than 100 million EUR, the issuer is subject to the man-
datory reporting to the CA of the templates developed under these ITS, on a quarterly basis9.
The valuation of the tokens should be based on the methodologies and practices described
particular in paragraphs 11 and 12 of Article 36 and paragraph 2, letter (c) of Article 39. These
practices should also ensure that the valuation of such tokens is harmonized and aligned
throughout the different technical standards developed under MiCAR.
18. Issuers have to report the value of the token issued. However as MiCAR does not specify the
nature of this value, the ITS require in template S 02.00 - VALUE OF THE TOKEN ISSUED AND
THE SIZE OF THE RESERVE OF ASSETS the reporting of the following types of values for the token
issued: value at reference date; the minimum, the maximum and the average values over the
preceding quarter. The value at reference date gives a point in time value, the same point in
time value as the number of holders to be reported, which is the value as of the end of the
reporting period. The minimum, maximum and average values10 over the preceding quarter
provide information to the CAs on the fluctuation and stability of the value of the token. The
ITS specify that the maximum of these values during the preceding quarter should be the trig-
gering criteria for the reporting obligations and to assess the EUR 100 000 000 threshold men-
tioned in Article 22 of MiCAR. This means in practice that if at least once at the end of one
calendar day the value of the token issued exceed the threshold, the issuer becomes subject to
the mandatory reporting obligations regardless of the value of the token issued at the end of
the reporting period.
Question 2: Do you agree with the template S 02.00 - VALUE OF THE TOKEN ISSUED AND THE SIZE
OF THE RESERVE OF ASSETS on how issuers should report the different values of the token issued
in Article 22(1)(b) of MiCAR, and in particular do you agree with how the maximum value that would
trigger the reporting obligation is defined? If not, please provide your reasoning and suggest an
Reporting by issuers of ARTs on the reserve of assets in Article 22(1)(b) of MiCAR
19. Issuers are also required to report the size of the reserve of assets, one of the criteria for clas-
sifying an ART as a significant ART based on Article 43 of MiCAR. For reporting the size of the
reserve of assets, the ITS specify an approach similar to that described in paragraph 18 above.
Therefore, issuers will have to report in template S 02.00 - VALUE OF THE TOKEN ISSUED AND
THE SIZE OF THE RESERVE OF ASSETS the size of the reserve of assets as of the reporting refer-
ence date, and the maximum, the minimum and the average values during the preceding quar-
9
Based on Article 22(2) of MiCAR, CAs may require issuers to report the information in Article 22 also for ARTs with an
issue value of less than EUR 100 million.
10
Calculations of such values are based on end of the calendar day values of the token issued.
10
ter. In addition to the reasons explained above for the value of the token issued, it is very rele-
vant for CAs the information on the size of the reserve of assets, since it includes liquidity
measures as well, ensuring the overall soundness of the market.
20. On the other hand, the EBA is developing two separate RTS under MICAR, one further specifying
the liquidity requirements of the reserve of assets under Article 36(4) of MICAR
(EBA/CP/2023/25) and another one specifying the highly liquid financial instruments in the re-
serve of assets under Article 38(5) of MICAR (EBA/CP/2023/24). The ITS now being consulted
include templates S 03.01 - COMPOSITION OF THE RESERVE OF ASSETS BY TYPE OF ASSETS AND
MATURITIES and S 03.02 - COMPOSITION OF THE RESERVE OF ASSETS BY COUNTERPARTY/IS-
SUER that provide the information that the CAs need to monitor the compliance with the re-
quirements related to reserve of assets prescribed by MiCAR and the abovementioned RTS.
Question 3: Do you agree with template S 02.00 - VALUE OF THE TOKEN ISSUED AND THE SIZE OF
THE RESERVE OF ASSETS on how issuers should report the size of the reserve of assets in Article
22(1)(b) of MiCAR, and with templates S 03.01 - COMPOSITION OF THE RESERVE OF ASSETS BY TYPE
OF ASSETS AND MATURITIES and S 03.02 - COMPOSITION OF THE RESERVE OF ASSETS BY
COUNTERPARTY/ISSUER related to the requirements specified on the RTS developed under Articles
36(4) and 38(5) of MiCAR? If not, please provide your reasoning and suggest an alternative
approach.
The scope and reporting by issuers of ARTs of transactions according to Article 22(1)(c)
and (d) of MiCAR
21. The second subparagraph of Article 22(1) of MiCAR defines a “transaction”, for the purpose of
points (c) and (d) of Article 22(1), as: “any change of the natural or legal person entitled to the
token as a result of the transfer of the token from one distributed ledger address or account to
another”. Relatedly, Recital 60 of MiCAR states that “To capture all transactions that are con-
ducted in relation to any given asset-referenced token, the monitoring of such tokens therefore
includes the monitoring of all transactions that are settled, whether they are settled on the
distributed ledger (‘on-chain’) or outside the distributed ledger (‘off-chain’), and including
transactions between clients of the same crypto-asset service provider”.
22. Taking into account recital 60, the ITS consider that “transactions” to be reported according to
Article 22(1) of MiCAR should include both transactions settled on a distributed ledger (‘on-
chain’) and transactions settled outside a distributed ledger (‘off-chain’). Furthermore, trans-
fers between different addresses or accounts of the same person would not qualify as a “trans-
action” within the meaning of Article 22(1) of MiCAR and therefore should be excluded from
the scope of reporting transactions.
23. Transactions under Article 22(1)(d) of MiCAR are a subset of the transactions of Article 22(1)(c)
of the same Regulation. The narrower scope of the transactions for Article 22(1)(d) is defined
in the draft RTS under Article 22(6) of MiCAR, now under consultation (EBA/CP/2023/31).
11
24. For the reporting requirements in Article 22(1)(c) of MiCAR, the ITS specify in template S 04.01
- TRANSACTIONS PER DAY - AVERAGE that issuers should report them separately by the rele-
vant countries. In template S 04.02 - TRANSACTIONS PER DAY - AVERAGE_EU, issuers should
also report the transactions covering the EU. These templates include the following breakdown:
transactions made within the country, received transactions to the country and sent transac-
tions from the country11. The country of a transaction is the country of residence of the holders
involved, as defined in paragraph 15 in this CP. In case that both holders, the countries of orig-
inator and the beneficiary of the transaction are the same, the transaction should be reported
under transactions made within the country. If the countries of the originator and beneficiary
are different, then the transactions should be reported as received transactions to the country
when the country of the beneficiary is the country covered by the template, and transactions
to be reported as sent transactions from the country when the country of the originator is the
country covered by the template. This approach means that transactions between holders of
different countries will be reported twice but under different countries, once as a received
transaction and once as a sent transaction. These templates should support CAs when moni-
toring the concentration and related volumes of the transactions, and support to determine
which CAs qualify to be member of a college of supervisors under Article 119(2)(l) of MiCAR (as
per the criteria proposed in the related CP on draft RTS on supervisory colleges under MiCAR,
EBA/CP/2023/33) and when monitoring the significance criteria related to the international
scale of the token as described in Article 43(1)(e) of MiCAR.
25. For transactions under Article 22(1)(d), the ITS include the same approach as described above
and use the same structure of the reporting template for issuers (template S 05.00 - TRANSAC-
TIONS PER DAY THAT ARE ASSOCIATED TO ITS USES AS A MEANS OF EXCHANGE WITHIN A SIN-
GLE CURRENCY AREA - AVERAGE). The only difference is that in this case the country breakdown
is not requested. Instead, there is a breakdown by `single currency area` as prescribed in Article
22(1)(d) of MiCAR. The methodology regarding how a single currency area is defined and what
transactions are in scope for these templates are defined in the draft RTS under Article 22(6) of
MiCAR, now under consultation (EBA/CP/2023/31).
26. Finally, the ITS also include template S 04.03 - TRANSACTIONS AND TRANSFERS PER DAY BE-
TWEEN NON-CUSTODIAL WALLETS - AVERAGE covering transactions between non-custodial
wallets or between other types of distributed ledger addresses where there is no CASP in-
volved; and transfers between non-custodial wallets or between other types of distributed
ledger addresses where there is no CASP involved. Information on transactions between non-
custodial wallets or other types of distributed ledger addresses where there is no CASP involved
should only be requested on a best effort basis, taking into account the limited information
available in such cases. Issuers would not necessarily know whether the transfer is made be-
tween addresses of different persons or between addresses of the same person, which means
that the issuer may not be able to determine whether the transfer qualifies as a “transaction”
as defined in Article 22(1) of MiCAR. Template S 04.03 includes information on the number and
11
For the separate template covering EU transactions, the wording will change accordingly from country to EU for these
breakdowns.
12
value of transfers between non-custodial wallets or other types of distributed ledger addresses
where there is no CASP involved, along with the transactions between non-custodial wallets or
other types of distributed ledger addresses where there is no CASP involved. This information
should allow CAs to monitor the scale of such transfers. This could be used as a proxy for these
types of transactions (as “transactions”, as defined in Article 22(1) of MiCAR, are a subset of
transfers – which include any transfer with a token in scope, regardless of whether the transfer
is made between addresses of different persons or between addresses of the same person).
This additional template is defined only for the purposes of the reporting under Article 22(1)(c)
of MiCAR (not relevant for reporting under Article 22(1)(d) of the same Regulation).
Question 4: Do you agree with templates S 04.01 - TRANSACTIONS PER DAY - AVERAGE, S 04.02
- TRANSACTIONS PER DAY - AVERAGE_EU and S 05.00 - TRANSACTIONS PER DAY THAT ARE
ASSOCIATED TO ITS USES AS A MEANS OF EXCHANGE WITHIN A SINGLE CURRENCY AREA -
AVERAGE on how issuers should report transactions under Article 22(1)(c) and (d) of MiCAR? In
particular, do you agree to include a separate template (S 04.03 - TRANSACTIONS AND
TRANSFERS PER DAY BETWEEN NON-CUSTODIAL WALLETS - AVERAGE) requesting information
on transactions and transfers made between non-custodial wallets or other types of distributed
ledger addresses where there is no CASP involved? If not, please provide your reasoning and
suggest an alternative approach.
Reporting transactions by CASPs according to Article 22(3) of MiCAR
27. According to Article 22(3) of MiCAR, CASPs should provide issuers with the information that
they need to fill in the templates related to Article 22(1)(c) and (d). The ITS include template S
07.01 - INFORMATION ON TRANSACTIONS, which requires CASPs to include the following trans-
actional data for each transaction related to the ART in scope: the hash, the distributed ledger
address and the crypto-asset account number12 of the originator and/or of the beneficiary, as
applicable, the value and the date of the transaction, and the country of the holder of the orig-
inator and beneficiary involved in the transaction, in accordance with paragraph 15 of this CP,
and indicate whether the transaction is in scope for Article 22(1)(d) of MiCAR. Moreover, CASPs
should report to the issuer (template S 07.02 - DISTRIBUTED LEDGER ADDRESSES FOR MAKING
TRANSFERS ON BEHALF OF CLIENTS) the public distributed ledger addresses they use for mak-
ing transfers on behalf of their clients, in order to make it easier for issuers to identify which
transactions registered on the distributed ledger take place between non-custodial wallets.
28. These transactional data should allow issuers to reconcile the information shared by the CASPs
with their own databases, thus facilitating accurate reporting and data quality.
Question 5: Do you agree with template S 07.01 - INFORMATION ON TRANSACTIONS how CASPs
should report transactions of Article 22(1)(c) and (d) of MiCAR to the issuers? Do you agree with
12
Crypto-asset account number as in Article 14(1) and 14(2) of Regulation (EU) 2023/1113 of the European Parliament
and of the Council of 31 May 2023 on information accompanying transfers of funds and certain crypto-assets and
amending Directive (EU) 2015/849.
13
template S 07.02 - DISTRIBUTED LEDGER ADDRESSES FOR MAKING TRANSFERS ON BEHALF OF

CLIENTS to be reported by the CASPs to the issuers? If not, please provide your reasoning and
Data quality and the reconciliation by the issuer of the data reported by CASPs to the
issuer
29. On the CASPs side - The reporting obligations for the CASPs specified in the ITS following Article
22(3) of MiCAR should leverage on the controls and procedures that should be put in place by
CASPs to identify and verify the identity of their customers and conduct ongoing monitoring of
the business relationship with their customers in accordance with Directive (EU) 2015/84913
(AMLD). By compliance with AMLD, CASPs should possess the necessary information on
transactions and on holders to fill in their reporting templates defined in this ITS.
30. On the issuers side - When reporting the information in Article 22(1) of MiCAR to the CA, the
issuer should ensure that the information reported is correct, complete and submitted within
the deadlines specified in this draft ITS. Furthermore, both the draft ITS and the draft RTS under
Article 22(6) of MiCAR (EBA/CP/2023/31) require issuers to have systems and procedures in
place that allow them to reconcile, for each transaction, the data reported by the CASP of the
originator and the CASP of the beneficiary to the issuer pursuant to Article 22(3) of MiCAR, and
the data available to the issuer from other sources, including, where applicable, transactional
data available on the distributed ledger. This aims to ensure that the data reported to the CA is
correct and complete, and to avoid double-counting of transactions and holders reported by
the different CASPs.
31. In order to facilitate a smooth reconciliation of the data shared by the CASPs, the issuers should
prescribe the exact format and extension of the files they receive from the CASPs, as specified
in Article 4 of the draft ITS. To avoid for CASPs to follow several different approaches introduced
by different issuers, one common format and extension would be recommended to use. This
should be widely used, easily accessible option in the market that would be suitable to transmit
the data between the CASPs and issuers.
Question 6: Do you agree that issuers should define and agree on one common harmonized format
and file extension, that they request the CASPs to use for submitting the reports for them? If yes,
please provide your suggestions for this common format and file extension.
The reporting reference dates and related reporting remittance dates
32. MiCAR defines in Article 22(1), that issuers shall report on a quarterly basis to the CA, therefore
the EBA proposes that the reporting reference dates should be 31 March, 30 June, 30 Septem-
ber and 31 December. In order to give enough time for the CASPs to prepare and share the
templates with the issuers, and then for the issuers to reconciliate the data received by the
13
Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use
of the financial system for the purposes of money laundering or terrorist financing
14
different CASPs and fill in the templates to be submitted to the CAs, the EBA proposes that the
remittance dates should be the following:
- For CASPs, 10 calendar days after the reporting reference dates, therefore 10 April, 10
July, 10 October and 10 January.
- For issuers, the remittance dates are proposed to be 30 calendar days after the report-
ing reference dates, therefore 30 April, 30 July, 30 October and 30 January.
33. If the remittance day is a public holiday in the Member State of the CA to which the submission
of the reporting templates is to be provided, or a Saturday or a Sunday, the submission should
be on the following working day.
15
CP ON THE ITS ON THE REPORTING ON ASSET-REFERENCED TOKENS UNDER ARTICLE 22(7) OF MICAR
5. Draft implementing technical

standards
16
COMMISSION DELEGATED REGULATION (EU) …/…
of XXX
supplementing Regulation (EU) 2023/1114 of the European Parliament and of the

Council on markets in crypto-assets with regard to implementing technical standards
establishing standard forms, formats and templates for the purposes of reporting
related to asset-referenced tokens under Article 22(1) and (3) of Regulation (EU)
2023/1114 and the reporting related to e-money tokens pursuant to Article 58(3) of
that Regulation
(Text with EEA relevance)
THE EUROPEAN COMMISSION,
Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) 2023/1114 of the European Parliament and of the Council
on markets in crypto-assets, and amending Regulations (EU) No 1093/2010 and (EU) No
1095/2010 and Directives 2013/36/EU and (EU) 2019/193714, and in particular to Article
22(7) third subparagraph thereof,
Whereas:
(1) For the purposes of the reporting in Article 22(1)(a) of Regulation (EU) 2023/1114,
issuers should provide the number of holders with a breakdown by the holders` loca-
tion and within that location the number for custodial wallet holders and the number
for non-custodial wallet holders or holders of any other types of distributed ledger
addresses that are used for settlement purposes and are not controlled by a user or by
a crypto asset service provider. Within these two categories of holders, issuers should
provide, with an additional breakdown, the number of retail holders. All these break-
downs are necessary to the competent authorities, as information on the concentration
of holders and on the volumes for the retail holders are relevant for the supervisors to
meet the objectives of Regulation (EU) 2023/1114 and ensure the proper functioning
of markets in crypto-assets, market integrity and financial stability in the European
Union, as well as the protection of holders of crypto-assets, in particular retail holders.
The information provided with the breakdown by location of the holders should also
be used to determine which competent authorities will qualify to be members of a
college under Article 119(2)(l) of Regulation (EU) 2023/1114, following the criteria
stated in Commission Delegated Regulation (EU) 2023/xx [RTS under Article 119(8)
of MiCAR].
(2) For the purposes of the reporting in Article 22(1)(b) of Regulation (EU) 2023/1114,
and in order to ensure a proper supervision of the requirements stated for reserve of
14
Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-as-
sets, and amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU)
2019/1937 (OJ L 150, 9.6.2023, p. 40–205)
17
assets in accordance with Articles 36 and 38 of Regulation (EU) 2023/1114 and with
Commission Delegated Regulation (EU) 2023/xx [RTS under Article 36(4) and 38(5)
of MiCAR], issuers should provide the size of the reserve of assets in a broken-down
manner to reflect the value and the composition of the reserve of assets, including
liquidity management measures. Such a requirement under this Regulation can be
considered as proportionate as asset-referenced tokens issuers shall, in any event, un-
der Article 30 of Regulation (EU) 2023/1114, disclose, in a publicly and easily acces-
sible place, on their website, the value and composition of the reserve of assets re-
ferred to in Article 36 of Regulation (EU) 2023/1114.
(3) Considering the definition of “transactions” in Article 22(1) second subparagraph of

Regulation (EU) 2023/1114 and recital 60 of that Regulation, transaction to be re-
ported according to Article 22(1) of Regulation (EU) 2023/1114 should include trans-
actions settled on the distributed ledger (‘on-chain’) and transactions settled outside
the distributed ledger (‘off-chain’). Transfers of an asset-referenced token between
different addresses or accounts of the same person should be excluded from the scope
of the reporting in Article 22(1) (c) and (d) of Regulation (EU) 2023/1114 as they do
not qualify as a “transaction” within the meaning of that Regulation, with the excep-
tion of transfers between non-custodial wallets or other types of distributed ledger
addresses that are used for settlement purposes and are not controlled by a user or by
a crypto-asset service provider. Such transfers are to be reported separately by the
issuers pursuant to Article 22(1)(c) of that Regulation.
(4) The definition of “transaction” in Article 22(1) second subparagraph of Regulation

(EU) 2023/1114 is agnostic to the type of wallets used by the originator or by the
beneficiary for sending or receiving a transaction. Accordingly, the reporting in Arti-
cle 22(1) (c) and (d) of that Regulation should include transactions between custodial
wallets and transactions between a custodial wallet and a non-custodial wallet or other
types of distributed ledger addresses that are used for settlement purposes and are not
controlled by a user or by a crypto asset service provider. In addition, the reporting in
Article 22(1) (c) should also cover transactions between non-custodial wallets or be-
tween non-custodial wallets and other types of distributed ledger addresses that are
used for settlement purposes and are not controlled by a user or by a crypto-asset
service provider. Since issuers have limited information on the holders involved in
these transactions, in some cases it cannot be determined whether these are fulfilling
the conditions to be treated as transactions. Therefore, to have the most accurate in-
formation possible on these transactions, the reporting in Article 22(1) (c) should also
include information on transfers between non-custodial wallets or between non-cus-
todial wallets and other types of distributed ledger addresses that are used for settle-
ment purposes and are not controlled by a user or by a crypto asset service provider.
As transactions are a subset of transfers, these additionally included transfers between
non-custodial wallets or between non-custodial wallets and other types of distributed
ledger addresses that are used for settlement purposes and are not controlled by a user
or by a crypto-asset service provider could be used as a proxy and provide useful
information on the number and value of the transactions between non-custodial wal-
lets or between non-custodial wallets and other types of distributed ledger addresses
that are used for settlement purposes and are not controlled by a user or by a crypto-
asset service provider. The exact scope and related methodology for the calculation
18
for the reporting obligations of issuers under Article 22(1) (d) of Regulation (EU)
2023/1114 is defined in the Commission Delegated Regulation (EU) 2023/xx [RTS
under Article 22(6) of MiCAR].
(5) For the purposes of the reporting in Article 22(1)(c) of Regulation (EU) 2023/1114,
issuers should provide the information on the transactions with a breakdown for geo-
graphical distribution, meaning the countries of origin of the holders involved in the
transactions. That is to provide useful information on the concentration of transactions
for the competent authorities performing their supervisory roles. The information pro-
vided with the breakdown by countries of the transactions will be also used to deter-
mine which competent authorities will qualify to be members of a college under Ar-
ticle 119(2)(l) of Regulation (EU) 2023/1114, according to the criteria set out in Com-
mission Delegated Regulation (EU) 2023/xx [RTS under Article 119(8) of MiCAR].
This breakdown is not required for the transactions and transfers between non-custo-
dial wallets or between non-custodial wallets and other types of distributed ledger
addresses that are used for settlement purposes, due to the limited information issuers
have on the holders involved in such transactions and transfers.
(6) For the purposes of reporting in Article 22(3) of Regulation 2023/1114, some infor-
mation which crypto-asset service providers should provide to the issuers can include
personal data when it relates to natural persons. This includes for example full name(s)
accompanied by national identification number, official tax registration number, or
passport number. The collection of such personal data in this case is necessary in order
to achieve the objectives of Regulation (EU) 2023/1114 as without this information
the issuers could not determine the exact number of holders of an asset-referenced
token and they would be double counting holders having multiple accounts with dif-
ferent crypto-asset service providers at the same time. This would distort the infor-
mation reported to the competent authorities about the number of holders of an asset-
reference token and would therefore hinder proper supervision by the competent au-
thorities. As a result of the above, there is no other way to accurately reflect the infor-
mation on the holders of asset-referenced tokens in the reporting and the usual
measures for limiting or protecting personal data sharing, such as pseudonymisation,
cannot be applied in this case.
(7) In addition, for the purposes of reporting in Article 22(3) of Regulation 2023/1114,
crypto-asset service providers should also provide to the issuer the public distributed
ledger addresses they use for making transfers on behalf of their clients. This infor-
mation is necessary for issuers to be able to identify which transactions registered on
the distributed ledger take place between non-custodial wallets and report the trans-
actions in scope of the reporting obligations.
(8) To ensure that the information reported to the competent authority is correct and com-
plete, issuers should have systems and procedures in place that allow the issuer to
reconcile the data received from the crypto-asset service providers pursuant to Article
22(3) of Regulation (EU) 2023/1114. These systems and procedures should also allow
the issuer to reconcile the data reported by crypto-asset service providers with the data
19
available to the issuer from other sources, including, where applicable, transactional
data available on the distributed ledger.
(9) This Regulation should also apply mutatis mutandis to e-money tokens denominated
in a currency that is not an official currency of a Member State as Article 22 of Reg-
ulation (EU) 2023/1114 applies to e-money tokens denominated in a currency that is
not an official currency of a Member State.
(10) This Regulation is based on the draft regulatory technical standards submitted to the
Commission by the European Banking Authority.
(11) The European Banking Authority has conducted open public consultations on the draft
regulatory technical standards on which this Regulation is based, analysed the poten-
tial related costs and benefits and requested the opinion of the Banking Stakeholder
Group established in accordance with Article 37 of Regulation (EU) No 1093/2010 of
the European Parliament and of the Council15.
HAS ADOPTED THIS REGULATION:
Article 1
General provisions
1. For the purposes of the reporting referred to in Article 22(1) of Regulation (EU)
2023/1114, issuers shall submit to their competent authorities all the templates set out in
Annex I, in accordance with the instructions specified in Annex II of this Regulation.
2023/1114, crypto-asset service providers shall submit to the issuers the information set
out in Annex III, in accordance with the instructions specified in Annex IV of this
Regulation in order for the issuers to comply with the reporting obligations under this
Regulation.
15
Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a
European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing
Commission Decision 2009/78/EC (OJ L 331 15.12.2010, p. 12)
20
Article 2
Reporting reference dates
1. For the purposes of the reporting referred to in Article 22(1) of Regulation (EU) No
2023/1114, issuers shall submit information to competent authorities on a quarterly report-
ing basis, with the following reporting reference dates: 31 March, 30 June, 30 September
and 31 December.
2. The first reference date shall be the one corresponding to the quarter in which the issue
value of the asset-referenced token is higher than the threshold referred to in Article 22(1)
of Regulation (EU) 2023/1114.
3. The last reference date shall be the one corresponding to the third consecutive quarter in
which the issue value of the asset-referenced token is lower than the threshold referred to
in Article 22(1) of Regulation (EU) No 2023/1114.
Article 3
Reporting remittance dates
2023/1114, issuers shall submit the information stated in Article 22(1) of that Regulation
to competent authorities on a quarterly reporting basis, by close of business on the fol-
lowing remittance dates: 30 April, 30 July, 30 October and 30 January.
2023/1114, crypto-service asset providers shall submit the information stated in Article
22(3) of that Regulation to the issuers on a quarterly reporting basis, by close of business
on the following remittance dates: 10 April, 10 July, 10 October and 10 January.
3. If the remittance day is a public holiday in the Member State of the competent authority
to which the report is to be provided, or a Saturday or a Sunday, data shall be submitted
on the following working day.
4. Issuers shall submit corrections to the reports submitted to the competent authorities with-
out undue delay.
Article 4
Data exchange formats and information accompanying submissions
1. Issuers shall submit the information referred to in this Regulation in the data exchange
formats and representations specified by the competent authorities and respecting the data
point definition of the data point model and the validation formulae stated in Annex V and
the following specifications:
(a) information that is not required or not applicable shall not be included in a data
submission;
(b) numerical values shall be submitted as follows:
21
i. data points with the data type ‘Monetary’ shall be reported using a minimum
precision equivalent to thousands of units;
ii. data points with the data type ‘Integer’ shall be reported using no decimals
and a precision equivalent to units.
2. Crypto-asset service providers shall submit the information referred to in Article 1(2) to
the issuers in the data exchange formats and representations specified by the issuers and
respect the data point definition of the data point model and the validation formulae stated
in Annex V.
Article 5
Final provisions
This Regulation shall enter into force on the twentieth day following that of its publication
in the Official Journal of the European Union.
It shall apply from 30 December 2024.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
Done at Brussels,
For the Commission

The President
[For the Commission

On behalf of the President
[Position]
ANNEXES
Please see separate files
Annex I – Reporting for issuers of asset-referenced token - templates

Annex II – Reporting for issuers of asset-referenced token – instructions
Annex III – Reporting for crypto-asset service providers - templates
Annex IV – Reporting for crypto-asset service providers – instructions
Annex V – DPM and validation rules
22
23
6. Accompanying documents
6.1 Draft cost-benefit analysis / impact assessment

According to Articles 10 of Regulation (EU) No 1093/2010 (EBA Regulation), the EBA shall analyse
the potential costs and benefits of draft RTS and ITS developed by the EBA. The ITS developed by
the EBA shall therefore be accompanied by an Impact Assessment (IA) which analyses ‘the potential
related costs and benefits‘.
This analysis presents the IA of the main policy options regarding the draft ITS on the reporting on
ARTs under Article 22(7) of MiCAR.
MiCAR sets out a new legal framework for the issuers of ARTs. This includes the obligation of issuers
of ARTs to report, on a quarterly basis, to the CA related to these tokens the number of holders,
the value of the token issued and the size of the reserve of assets, the average number and average
aggregate value of transactions per day during the relevant quarter, and an estimate of the average
number and average aggregate value of transactions per day during the relevant quarter that are
associated to its uses as a means of exchange within a single currency area. This reporting obligation
applies to each ART with an issue value that is higher than EUR 100 000 000, and, where the CA so
decides in accordance with paragraph 2 of Article 22, also to ARTs with a value of less than
EUR 100 000 000. Regarding the transactions that are associated to its uses as a means of exchange,
a separate RTS is defining the exact scope of the transactions and the methodology for their calcu-
lations (see CP on draft RTS under Article 22(6) of MiCAR, EBA/CP/2023/31). In this regard, the costs
and benefits related to the calculation and reporting of these transactions are covered in the IA in
the CP on those RTS, and are not repeated in this IA.
To enable issuers to report this information, MiCAR requires CASPs that provide services related to
ARTs to report to the issuer the information necessary for issuers to prepare such reports, including
by reporting transactions that are settled outside the distributed ledger. The information that
CASPs should report to the issuer in accordance with MiCAR is also specified in this draft ITS
developed under Article 22(7) of MiCAR.
A. Problem identification
While the requirement for issuers to report the information mentioned above is clearly listed in
MiCAR, the text does not specify exact details on how issuers should calculate and present the
reportable values. Because the legal framework introduced by MiCAR is new, there is no established
methodology to calculate these numbers and values. Moreover, currently there is limited data
available particularly with regard to the geographical location of the holders of such tokens, as well
as information whether the transfers of such tokens are made between addresses of different
persons or between addresses of the same person. These data limitations add challenges to what
data can be reported and how it should be presented.
24
B. Policy objectives
The general objective of the draft ITS is to clarify the reporting obligation of issuers and CASPs in
accordance with MiCAR and to support the objectives of MiCAR of ensuring that the data reported
allows to:
- the CAs to monitor and ensure the proper functioning of markets in crypto-assets,
market integrity and financial stability in the EU;
- protect holders, in particular retail holders;
- monitor and prevent risks that the wide use of ARTs as a means of exchange may have
on monetary policy transmission and monetary sovereignty within the EU, through
currency substitution effects;
- assess whether an ART meets the criteria in Articles 43(1) and 56(1) of MiCAR to be
classified as significant.
The draft ITS also aims to ensure that issuers apply the same methodology to calculate the
reportable numbers and values and submit them to the respective CAs using the same templates
and formats. This is to have one common, harmonized general reporting package under MiCAR.
C. Baseline scenario
In a baseline scenario, the issuers of ART and respective CASPs would need to apply the MiCAR
requirements to report the information described in Article 22 of MiCAR without a clear
methodology on how to calculate the data, and without general harmonized reporting templates
and related instructions for how to report the data. This scenario would lead to divergent
approaches and interpretations on the calculation methods and in the reporting practices. This
would lead to CAs having data that is not comparable and not in the format that facilitates their
supervisory roles and activities. Moreover, such a divergence in approaches may lead to unreliable
data quality in general which will create level playing field issues, and would not meet the objectives
of MiCAR explained above.
The costs and benefits of the underlying Regulation, i.e. MiCAR, are not assessed within this impact
assessment.
D. Policy issues, options considered
Policy issue 1: Level of detail on the number of holders
Following Article 22(1)(a) of MiCAR issuers required to report the number of holders. The EBA is of
the view that holders of a token in scope of reporting obligations should be only counted once,
regardless of the number of different accounts a holder might possess in several CASPs. In order to
25
filter out possible duplications of the same holder having multiple accounts, CASPs should share
their list of holders with the issuers with unique identifiers for each holder. Thus, issuers could
reconcile the lists they receive from the CASPs and compare with their own data sources as well.
Since Article 22(1) of MiCAR does not define the exact measures to be reports for the number of
holders, EBA has considered the following values to be reported on this subject: the maximum, the
minimum and the average number of holders throughout the quarter (reporting period) and the
total number of holders at the end of the quarter (reporting period), at reference date. Taking into
account the abovementioned reconciliation activity that the issuer should perform in order to filter
out the duplication of holders, and the related data sharing from the CASPs, for the calculation of
the maximum, minimum and average number of holders a daily frequency of data sharing and rec-
onciliation would be needed. The calculation of the number of holders at reference date requires
the provision of data from CASPs and its reconciliation for one day only. Even though the maximum,
minimum and average values would offer useful information for the CAs on the fluctuation of the
number of holders, adding them to the requirements would significantly increase the reporting
burden for both issuers and CASPs, by requiring the submission of datasets and reconciliation of
the data for each day within the quarter. Therefore the option requiring the reporting of the num-
ber of holders only at reference date was preferred.
In order for CAs to perform their supervisory and other statutory activities, further information
related to the number of holders would be needed. The following details and breakdown within
the total number of holders at reference date were considered:
(a) Country of the holders;
(b) Number of retail and non-retail holders;
(c) Number of holders of custodial and non-custodial wallets16;
(d) Sectoral breakdown, based on the industries the holders are associated to.
Concerning point (a), having a country level breakdown for the number of holders would provide
useful information to the CAs on geographical concentration. Since the information on the country
of a holder is essential for issuers to comply with the reporting obligations following Article
22(1)(d)17 of MiCAR and the separation of holders by country does not create huge additional re-
porting burden, the country level of breakdown was included in the template developed for the
number of holders.
Concerning points (b) and (c), both breakdowns hold information important for the CAs. As one
MiCAR objective is to protect holders, especially retail holders, it is important that the numbers of
retail and non-retail holders are monitored. Information on the volume and its evolution through
16
Or holder of any other type of distributed ledger address that is used for settlement purposes and not controlled by a
17
CP on draft RTS under Article 22(6) of MiCAR, EBA/CP/2023/31
26
time of custodial and non-custodial wallet holders are also important for the CAs, taking into ac-
count the limited information on the transactions between holders of non-custodial wallets. As
reporting the breakdowns in points (b) and (c) are not creating significant additional reporting bur-
den, the benefits of their inclusion to the template outweigh the related reporting costs.
Regarding point (d), sectoral distribution of holders would give useful and important insight related
to the token in scope of the supervisors and CAs. Even though this additional breakdown would
bring benefits, adding it to the templates could create difficulties for complying with the reporting
requirements, because the issuers and CASPs might not possess this type of information on each
holder. Therefore inclusion of such breakdown has been discarded.
Policy issue 2: Value of the token issued and the size of the reserve of assets
Article 22(1)(b) of MiCAR requires issuers to report the value of the ART issued and the related
reserve of assets, but it does not specify the exact type of the measures and related calculations
for them. Apart from being one of the criteria for determining significance of an ART18, the value of
the token issued is also important because it is used to define the threshold for the reporting obli-
gations following Article 22(1) of MiCAR: “For each asset-referenced token with an issue value that
is higher than EUR 100 000 000, the issuer shall report on a quarterly basis…”. The EBA is of the
view that this reporting threshold should be the maximum value of the token issued during the
quarter. Therefore even if the EUR 100 000 000 threshold has been hit only once during a quarter,
issuers should report the templates defined in this ITS to the CAs. Additionally, three additional
values have been considered to be added to the template: the minimum, the average values for
the quarter and the value at reference date of the token issued, giving important information for
the CAs on the fluctuation and stability of the token. The same approach has been considered for
reporting on the size of the reserve of assets, asking the minimum, the average, the maximum val-
ues for the quarter and the value at reference date.
This would require issuers to calculate the value of the token issued and the size of the reserve of
assets on a daily basis, which is in line with Article 36(7) of MiCAR and that “Issuers of asset-refer-
enced tokens shall constitute and at all times maintain a reserve of assets.” following Article 36(1),
and therefore will not represent additional burden for the issuers of ARTs. The reporting itself will
represent a limited burden, but since data will already be available, this would offer useful infor-
mation for the CAs assisting their supervisory roles.
Policy issue 3: Reporting on the reserve of assets
Issuers face additional requirements related to their reserve of assets. Based on the RTS following
Article 36(4)19 and Article 38(5)20 of MiCAR, issuers will be required to comply with specific liquidity
requirements while building up and maintaining their reserve of assets. When doing so issuers shall
follow the respective RTS on what could be included as highly liquid financial instruments in the
reserve of assets. The mandates of these RTS do not prescribe general and harmonized supervisory
18
As defined in Article 43(1) of MiCAR
19
CP on draft RTS further specifying the liquidity requirements of the reserve of assets, EBA/CP/2023/25
20
CP on draft RTS to specify the highly liquid financial instruments in the reserve of assets, EBA/CP/2023/24
27
reporting obligations for the issuers. The EBA is of the view, that additional two templates should
be developed under the scope of letter (b) of Article 22(1) of MiCAR, covering the requirements set
by the abovementioned RTS. Based on Article 30 of MiCAR, issuers shall disclose information on the
value and composition of their reserve of assets in a publicly and easily accessible place on their
website on a monthly basis. This provision does not specify harmonized templates and formats for
disclosing this information, therefore comparability and data quality of these disclosures could be
insufficient from a supervisor perspective. The additional cost for issuers by including these two
additional templates would only come from filling them in, as they shall anyway monitor compli-
ance with such requirements on their reserve of assets. Therefore, submitting these templates
would not create significant additional reporting burden, and the benefits of their inclusion, namely
CAs` ability to monitor compliance with the requirements and better performance of their supervi-
sory roles, outweigh the related reporting costs.
Policy issue 4: Reporting on the transactions in scope under Article 22(1)(c) of MiCAR
Based on Article 22(1)(c) of MiCAR, issuers should report the average number and average aggre-
gate value of transactions per day during the relevant quarter. This information will be used for
determining the significance of an ART following Article 43(1) of MiCAR. For the CAs, further details
could ensure better supervision, as having more information would cover more possible areas of
risks. Given that issuers should know the country of the holders involved in the transactions for
allocating them into single currency areas21, issuers should possess the needed information for al-
locating all transactions in scope under Article 22(1)(c) of MiCAR to countries. Therefore including
the breakdown of countries and an additional category covering the EU for these transactions
would give CAs useful insight on the concentration of transactions, without a significant increase in
the reporting burden for issuers. Also, this information would allow monitoring of the significance
of activities on an international scale, which is another significance criteria based on Article 43(1)(e)
of MiCAR.
For the purpose of allocating a transaction to a country, based on the countries of the two holders
involved in the transaction, 3 subcategories of transaction have been defined:
(i) Of which within the country;
(ii) Of which received transaction to the country; and
(iii) Of which sent transaction from the country.
Under point (i) issuers should report transactions where both holders are of the same country. For
point (ii), issuers should report transactions where the beneficiary of the transaction is within a
country, and the originator is outside of that country. Finally, for point (iii), issuers should report
transactions where the originator of the transaction is within the country, and the beneficiary is
outside of that country. With the data provided by the CASPs, issuers should possess all the neces-
21
As this methodology is defined in the CP on draft RTS under Article 22(6) of MiCAR, EBA/CP/2023/31
28
sary information to allocate the transactions to countries and to the abovementioned 3 subcatego-
ries. At the same time, these templates would offer to the CAs great insight of the movements and
related volumes of the tokens in scope, having necessary information for better understanding and
monitoring the market of ARTs.
An additional template covering transactions between non-custodial wallets 22 and transfers be-
tween non-custodial wallets23 have been added under the scope of Article 22(1)(c). The rationale
and the related cost benefit analysis and impact assessment are presented in the CP on draft RTS
under Article 22(6) of MiCAR (EBA/CP/2023/31), due to its interconnectedness with this ITS.
Policy issue 5: Reconciliation of data received from CASPs
Article 22(3) of MiCAR requires CASPs that provide services related to ARTs to report to the issuer
the information necessary to enable the issuer to report to the CA the information in Article 22(1),
including by reporting transactions that are settled outside the distributed ledger. Its related cost
benefit analysis and impact assessment are presented in the CP on draft RTS under Article 22(6) of
MiCAR (EBA/CP/2023/31), due to its interconnectedness with this ITS.
E. Cost and benefit analysis
When comparing with the baseline scenario (where the issuer and CASPs will need to report
information without a clear methodology or guidance), the ITS is expected to bring benefits by
achieving a higher level of harmonisation of methodology, comparability of data, and better data
quality. This in turn will contribute to more effective supervision and monitoring of the crypto-
assets market within the EU, in line with the MiCAR requirements. In that way, these ITS contribute
to ensuring the safety and soundness of the European financial system.
The ITS is expected to lead to moderate costs to issuers and CASPs in relation to the application of
the methodologies and complying with the reporting obligations. These costs are associated with
the one-off costs related to the setting up of processes to fill in the reporting templates, as well as
recurring costs related to the data collection and processing, filling-in of the templates, ensuring
the data quality checks, and the submission of the reporting packages on a quarterly basis to the
CAs. These costs are expected to be moderate, given that the costs of the ITS are only incremental
to the costs for implementing the existing reporting requirements set out in MiCAR.
6.2 Overview of questions for consultation

Question 1: Do you agree with the proposal included in the ITS on how issuers and CASPs should
report on holders in Article 22(1)(a) of MiCAR? If not, please provide your reasoning and suggest
an alternative approach.
22
Or between any other type of distributed ledger address that is used for settlement purposes and not controlled by a
23
Or between any other type of distributed ledger address that is used for settlement purposes and not controlled by a
29
Question 2: Do you agree with the template S 02.00 - VALUE OF THE TOKEN ISSUED AND THE SIZE
OF THE RESERVE OF ASSETS on how issuers should report the different values of the token issued
in Article 22(1)(b) of MiCAR, and in particular do you agree with how the maximum value that would
trigger the reporting obligation is defined? If not, please provide your reasoning and suggest an
Question 3: Do you agree with template S 02.00 - VALUE OF THE TOKEN ISSUED AND THE SIZE OF
THE RESERVE OF ASSETS on how issuers should report the size of the reserve of assets in Article
22(1)(b) of MiCAR, and with templates S 03.01 - COMPOSITION OF THE RESERVE OF ASSETS BY TYPE
OF ASSETS AND MATURITIES and S 03.02 - COMPOSITION OF THE RESERVE OF ASSETS BY
COUNTERPARTY/ISSUER related to the requirements specified on the RTS developed under Articles
36(4) and 38(5) of MiCAR? If not, please provide your reasoning and suggest an alternative
approach.
Question 4: Do you agree with templates S 04.01 - TRANSACTIONS PER DAY - AVERAGE, S 04.02 -
TRANSACTIONS PER DAY - AVERAGE_EU and S 05.00 - TRANSACTIONS PER DAY THAT ARE
ASSOCIATED TO ITS USES AS A MEANS OF EXCHANGE WITHIN A SINGLE CURRENCY AREA - AVERAGE
on how issuers should report transactions under Article 22(1)(c) and (d) of MiCAR? In particular, do
you agree to include a separate template (S 04.03 - TRANSACTIONS AND TRANSFERS PER DAY
BETWEEN NON-CUSTODIAL WALLETS - AVERAGE) requesting information on transactions and
transfers made between non-custodial wallets or other types of distributed ledger addresses where
there is no CASP involved? If not, please provide your reasoning and suggest an alternative
approach.
Question 5: Do you agree with template S 07.01 - INFORMATION ON TRANSACTIONS how CASPs
should report transactions of Article 22(1)(c) and (d) of MiCAR to the issuers? Do you agree with
template S 07.02 - DISTRIBUTED LEDGER ADDRESSES FOR MAKING TRANSFERS ON BEHALF OF
CLIENTS to be reported by the CASPs to the issuers? If not, please provide your reasoning and
Question 6: Do you agree that issuers should define and agree on one common harmonized format
and file extension, that they request the CASPs to use for submitting the reports for them? If yes,
please provide your suggestions for this common format and file extension.
Question 7: Do you have any other comments on the ITS, the templates or instructions?
30
EBA/CP/2023/31
8 November 2023
Consultation Paper
Draft Regulatory Technical Standards

on the methodology to estimate the number and value of
transactions associated to uses of asset-referenced tokens as a
means of exchange under Article 22(6) of Regulation (EU) No
2023/1114 (MiCAR) and of e-money tokens denominated in a
currency that is not an official currency of a Member State
pursuant to Article 58(3) of that Regulation
CP ON THE RTS ON THE USE OF ARTS AND EMTS DENOMINATED IN A NON-EU CURRENCY AS A MEANS OF
EXCHANGE UNDER ART. 22(6) AND 58(3) OF MICAR
Contents
2. Abbreviations 4
5. Draft regulatory technical standards 20
2

questions summarised in section 6.2.

 respond to the question stated;
 indicate the specific point to which a comment relates;
 contain a clear rationale;
 provide evidence to support the views expressed/ rationale proposed; and
 describe any alternative regulatory choices the EBA should consider.
by 08.02.2024. Please note that comments submitted after this deadline, or submitted via other
means may not be processed.
Please clearly indicate in the consultation form if you wish your comments to be disclosed or to be
treated as confidential. A confidential response may be requested from us in accordance with the
EBA’s rules on public access to documents. We may consult you if we receive such a request. Any
decision we make not to disclose the response is reviewable by the EBA’s Board of Appeal and the
European Ombudsman.
Data protection
The protection of individuals with regard to the processing of personal data by the EBA is based on
Regulation (EU) 1725/2018 of the European Parliament and of the Council of 23 October 2018.
website.
3
2. Abbreviations
AMLD Anti-money laundering directive (Directive (EU) 2015/849)

AML Anti-money laundering
ART Asset-referenced token
CASP Crypto-asset service provider
CP Consultation paper
CFT Countering financing of terrorism
EBA European Banking Authority
ECB European Central Bank
EU European Union
EMT E-money token
FTR Funds Transfer Regulation (Regulation (EU) 2023/1113)
ITS Implementing technical standards
MiCAR Regulation on markets in crypto-assets (Regulation (EU) 2023/1114)
RTS Regulatory Technical Standards
4
Article 22(1), point (d) of Regulation (EU) 2023/1114 (MiCAR) requires the issuer of an asset-refer-
enced token (ART) to report, among others, to the competent authority, on a quarterly basis, “an
estimate of the average number and average aggregate value of transactions per day during the
relevant quarter that are associated to uses [of the ART] as a means of exchange within a single
currency area”.
In support of these provisions, Article 22(6) of MiCAR mandates the EBA to develop, in close coop-
eration with the ECB, draft regulatory technical standards (RTS) specifying the methodology to es-
timate “the quarterly average number and average aggregate value of transactions per day that are
associated to uses [of an ART] as a means of exchange within a single currency area”, as referred
to in Article 22(1), point (d) of MiCAR.
In accordance with Articles 22(6) and 58(3) of MiCAR, the draft RTS proposed in this Consultation
Paper (CP) apply to both ARTs and e-money tokens (EMTs) denominated in a non-EU currency.
The draft RTS specify the methodology to be applied by issuers for reporting the transactions re-
ferred to in Article 22(1), point (d) of MiCAR, including how issuers should estimate the number and
value of transactions associated to uses of ARTs and of EMTs denominated in a non-EU currency
“as a means of exchange”, and the criteria for reporting these transactions per single currency area.
The draft RTS also clarify that it is the issuer’s responsibility to ensure that the information reported
to the competent authority pursuant to Article 22(1), point (d) of MiCAR is correct and complete.
To this end, the proposals set out in the draft RTS include a requirement for the issuer to have in
place systems and procedures that allow it to reconcile the data received from the crypto-asset
service provider (CASP) of the payer and the CASP of the payee, where applicable, pursuant to Ar-
ticle 22(3) of MiCAR and the implementing technical standards (ITS) under Article 22(7) of MiCAR,
as well as the data available from other sources, including, where applicable, data available on the
distributed ledger.
The reporting templates for the purpose of the reporting under Article 22(1), point (d) of MiCAR
are specified in the draft ITS under Article 22(7) of MiCAR, which are being consulted on under the
separate CP (EBA/CP/2023/32).
Next steps
The final draft RTS will be submitted to the European Commission for endorsement following which
they will be subject to scrutiny by the European Parliament and the Council before being published
5
4.1 Background
1. The Regulation (EU) 2023/1114 of the European Parliament and of the Council on markets in
crypto-assets (MiCAR) 1 regulates the offering to the public and admission to trading of asset-
referenced tokens (ARTs), e-money tokens (EMTs) and other types of crypto-assets, as well as
crypto-assets services provided by crypto-asset service providers (CASPs) in the European Un-
ion (EU). MiCAR entered into force on 29 June 2023, and will apply from 30 December 2024,
except for Titles III and IV regarding the offering to the public and the admission to trading of
ARTs and EMTs, that will apply from 30 June 2024.
2. The objectives of MiCAR are to ensure the proper functioning of markets in crypto-assets, mar-
ket integrity and financial stability in the EU, as well as the protection of holders of crypto-
assets, in particular retail holders 2. In particular, MiCAR aims to address risks that the wide use
of crypto-assets which aim to stabilise their price in relation to a specific asset or a basket of
assets (such as ARTs) could pose to financial stability, the smooth operation of payment sys-
tems, monetary policy transmission or monetary sovereignty 3.
3. MiCAR sets out a number of safeguards to address such risks. These include the monitoring by
competent authorities of the use of ARTs and of EMTs denominated in a non-EU currency and
limiting the issuance of these tokens when the volume and value of transactions associated to
uses of these tokens “as a means of exchange” exceed certain thresholds (which are set out in
Article 23 of MiCAR). Moreover, the competent authority may limit the issuance of these tokens
where the European Central Bank (ECB) or, where applicable, a central bank referred to in Ar-
ticle 20(4) of MiCAR, issues an opinion that such tokens pose a threat to the smooth operation
of payment systems, monetary policy transmission or monetary sovereignty 4.
4. To allow competent authorities to monitor the use of ARTs, Article 22(1) of MiCAR requires the
issuer of an ART to report on a quarterly basis to the competent authority:
(a) “the number of holders;
(b) the value of the asset-referenced token issued and the size of the reserve of assets;
(c) the average number and average aggregate value of transactions per day during the
relevant quarter; and
1
(OJ L 150, 9.6.2023, p. 40–205)
2
See recital 112 of MiCAR
3
See recital 5 of MiCAR
4
See Articles 24(3) and 58(3) of MiCAR
6
(d) an estimate of the average number and average aggregate value of transactions per
day during the relevant quarter that are associated to uses of the ART “as a means of
exchange” within a single currency area”.
5. The above reporting requirements apply for each ART with an issue value that is higher than
EUR 100 million, and where the competent authority so decides in accordance with Article
22(2) of MiCAR, also for ARTs with a value of less than EUR 100 million.
6. To enable issuers to report this information, Article 22(3) of MiCAR requires CASPs that provide
services related to ARTs to report to the issuer the information necessary to prepare the report
referred to in Article 22(1), including by reporting transactions that are settled outside the dis-
tributed ledger.
7. In support of these provisions, Article 22(6) of MiCAR mandates the EBA, in close cooperation
with the ECB, to develop draft regulatory technical standards (RTS) specifying the methodology
to estimate “the quarterly average number and average aggregate value of transactions per
day that are associated to uses [of an ART] as a means of exchange within a single currency
area”, as referred to in Article 22(1), point (d) of MiCAR. The EBA is required to submit these
draft RTS to the Commission by 30 June 2024.
8. Furthermore, Article 22(7) mandates the EBA to develop draft implementing technical stand-
ards (ITS) to establish standard forms, formats and templates for the purposes of the reporting
in Article 22(1), and for the purpose of the reporting by CASPs to the issuer in accordance with
Article 22(3). The EBA’s proposals on the draft ITS under Article 22(7) are included in the sepa-
rate CP (EBA/CP/2023/32).
9. In accordance with Article 58(3) of MiCAR, the provisions of Articles 22, 23 and 24(3) of MiCAR
shall also apply to EMTs denominated in a currency that is not an official currency of a Member
State. Accordingly, the RTS and ITS mentioned above shall also apply mutatis mutandis to such
tokens.
10. In what follows in the rationale section below, this Consultation Paper (CP) sets out how the
EBA proposes to fulfill the mandate in Article 22(6) of MiCAR (RTS), which includes the assess-
ments of various policy options that have been considered in the process. This is followed by
the actual RTS with the draft provisions proposed by the EBA. Questions have been inserted
throughout the document to elicit the views of external stakeholders.
4.2 Rationale
11. This chapter sets out the approach the EBA has taken to develop the methodology referred to
in Article 22(6) of MiCAR for reporting the information specified in Article 22(1)(d), and focuses
on six topics:
7
• the objectives of the reporting in Article 22(1), point (d) of MiCAR;
• the scope of transactions associated to uses of ARTs and of EMTs denominated in a

non-EU currency “as a means of exchange”, as referred to in Article 22(1), point (d) of
MiCAR;
• the reporting of transactions per single currency area, as referred to in Article 22(1),
point (d) of MiCAR;
• the calculation of the average number and average aggregate value of transactions
referred to in Article 22(1), point (d) of MiCAR;
• data quality and the reconciliation by the issuer of the data reported by CASPs to the
issuer; and
• the reporting of transactions between non-custodial wallets or between other type of

distributed ledger addresses where there is no CASP involved.
The objectives of the reporting in Article 22(1), point (d) of MiCAR
12. As mentioned above, Article 22(6) of MiCAR mandates the EBA to develop draft RTS specifying
the methodology to estimate “the quarterly average number and average aggregate value of
transactions per day that are associated to uses [of an ART] as a means of exchange within a
single currency area”, as referred to in Article 22(1), point (d) of MiCAR.
13. It is important to note that the transactions referred to Article 22(1), point (d) are the same as
the transactions that are subject to the caps in Article 23(1) of MiCAR. This latter Article limits
the issuance of an ART where “the estimated quarterly average number and average aggregate
value of transactions per day associated to its uses as a means of exchange within a single
currency area is higher than 1 million transactions and EUR 200 000 000, respectively” [empha-
sis added].
14. In accordance with Article 58(3) of MiCAR, the provisions in Articles 22 and 23(1) shall also apply
to EMTs denominated in a non-EU currency.
15. In developing the draft RTS, the EBA took into account the objectives of Articles 22(1), point (d)
and 23(1) of MiCAR, which, in the EBA’s view, are to monitor and prevent risks that the wide
use of ARTs and of EMTs denominated in a non-EU currency as a means of exchange may have
on monetary policy transmission and monetary sovereignty within the EU, through currency
substitution effects.
16. Also, in developing the draft RTS, the EBA took into account that the data to be reported by
issuers under Article 22(1), point (d) of MiCAR is needed, among others, in order to assess
8
whether an ART or an EMT denominated in a non-EU currency meets the criteria in Articles
43(1) and 56(1) of MiCAR to be classified as “significant” 5.
The scope of transactions associated to uses of ARTs and of EMTs denominated in a non-EU
currency “as a means of exchange”, as referred to in Article 22(1), point (d) of MiCAR
17. The second subparagraph of Article 22(1) of MiCAR defines a “transaction”, for the purpose of
points (c) and (d) of Article 22(1), as: “any change of the natural or legal person entitled to the
token as a result of the transfer of the token from one distributed ledger address or account to
another”. Relatedly, recital 60 states that the monitoring in Article 22 “includes the monitoring
of all transactions that are settled, whether they are settled on the distributed ledger (‘on-
chain’) or outside the distributed ledger (‘off-chain’), and including transactions between cli-
ents of the same crypto-asset service provider”.
18. In the EBA’s view, it follows from the above that the definition of “transactions” in Article 22(1)
of MiCAR includes both transactions settled on a distributed ledger (‘on-chain’) and transac-
tions settled outside a distributed ledger (‘off-chain’). Furthermore, in the EBA’s view, transfers
between different addresses or accounts of the same person do not qualify as a “transaction”
within the meaning of Article 22(1) of MiCAR and therefore should be excluded from the scope
of the reporting in Article 22(1), point (d) of MiCAR. This is reflected in recital 1 and Article 3(4)
of the draft RTS.
19. MiCAR does not define which transactions with an ART or with an EMT denominated in a non-
EU currency are considered to be “associated to uses [of that token] as a means of exchange”
but provides some indications as regards transactions that are included in this category, and
those that are excluded. In particular, recital 61 of MiCAR provides that transactions associated
with the use of an ART as a means of exchange include transactions “associated to payments of
debts including in the context of transactions with merchants”. Furthermore, the third subpar-
agraph of Article 22(1) provides that “transactions that are associated with the exchange for
funds or other crypto-assets with the issuer or with a crypto-asset service provider shall not be
considered associated to uses of the asset-referenced token as a means of exchange, unless
there is evidence that the asset-referenced token is used for the settlement of transactions in
other crypto-assets”. Relatedly, recital 61 provides that an ART should be deemed as used for
settlement of transactions in other crypto-assets “where a transaction involving two legs of
crypto-assets, which are different from the asset-referenced tokens, is settled in the asset-ref-
erenced tokens”.
20. In the EBA’s view, it follows from the above that the transactions associated to uses of an ART
or of an EMT denominated in a non-EU currency “as a means of exchange”, as referred to in
Article 22(1), point (d) of MiCAR, include transactions where such tokens are used to pay for
goods or services, irrespective of whether the payment is made to a merchant or any other
5
These criteria refer to, among others, “the average number and average aggregate value of transactions in [an ART or
an EMT]” (Art. 43(1)(c)) and “the significance of the activities of the issuer [...] on an international scale, including the use
of the [ART or of the EMT] for payments and remittances” (Art. 43(1)(e)).
9
payee (legal or natural person). This excludes the exchange of an ART or of an EMT denomi-
nated in a non-EU currency for funds or other crypto-assets with the issuer or with a crypto-
asset service provider, unless the respective ART or the EMT is used for the settlement of trans-
actions in other crypto-assets.
21. Furthermore, in developing the draft RTS, the EBA took into account that, depending on the
specific technical features of the underlying distributed ledger infrastructure used for transfers
of ARTs or EMTs (e.g, in the case of public, permissionless distributed ledger infrastructure),
the issuer or a CASP may not be able to determine with accuracy which transactions are asso-
ciated to uses of an ART or of an EMT denominated in a non-EU currency “as a means of ex-
change”. In this regard, Article 3(1) of the draft RTS provides that issuers should estimate the
number and value of transactions associated to uses of an ART as a means of exchange, as
referred to in Article 22(1), point (d) of MiCAR, by deducting from the total number and value
of transactions with an ART, during the relevant quarter, the transactions associated with the
exchange of the ART for funds or other crypto-assets with the issuer or with a CASP.
22. By derogation from the above, Article 3(2) of the draft RTS provides that transactions associ-
ated to uses of an ART as a means of exchange shall include the exchange of an ART for funds
or other crypto-assets with the issuer or with a CASP, where the ART is used for the settlement
of transactions in other crypto-assets. In line with recital 61 of MiCAR, this would be the case
“where a transaction involving two legs of crypto-assets, which are different from the asset-
referenced tokens, is settled in the asset-referenced tokens”. To further inform the EBA’s as-
sessment in this regard, the EBA is seeking feedback from external stakeholders on existing or
foreseen use cases in which an ART or an EMT denominated in a non-EU currency is used for
the settlement of transactions in other crypto-assets, as referred to in recital 61 and the third
subparagraph of Article 22(1) of MiCAR.
23. In accordance with Article 58(3) of MiCAR, these provisions shall also apply mutatis mutandis
to EMTs denominated in a non-EU currency. This is reflected in recital 9 and Article 1(2) of the
draft RTS.
Question 1: Do you agree with the EBA’s proposals on how issuers should estimate the number
and value of transactions associated to uses of an ART or of an EMT denominated in a non-EU
currency “as a means of exchange”, as reflected in Article 3 of the draft RTS? If not, please provide
your reasoning and the underlying evidence, and suggest an alternative approach for estimating
the number and value of these transactions.
Question 2: Please describe any observed or foreseen use cases where transactions involving two
legs of crypto-assets, that are different from an ART, are settled in the ART, as referred to in recital
61 of MiCAR.
10
24. As regards the geographical scope of the transactions covered by Article 22(1), point (d) of
MiCAR, in the EBA’s view, having discussed with the European Commission, the most reasona-
ble interpretation of MiCAR is that the reporting in Article 22(1), point (d) covers only transac-
tions where at least the payer or the payee is located in the EU, and excludes transactions
where both the payer and the payee are located outside the EU.
25. In the EBA’s view, this interpretation is in line with the objectives of Articles 22(1), point (d) and
23(1) of MiCAR, explained above, of preventing risks that the wide use of ARTs and of EMTs
denominated in a non-EU currency as a means of exchange may have on monetary policy trans-
mission and monetary sovereignty within the EU, through currency substitution effects. In the
EBA’s view, it was not the intention of the co-legislators to capture transactions where both the
payer and the payee are located outside the EU in the scope of the reporting in Article 22(1),
point (d) and of the caps in Article 23(1), taking into account that these transactions would be
unlikely to endanger monetary policy transmission and monetary sovereignty within the EU. In
arriving at this view, the EBA also took into account that, where both the payer and the payee
are located outside the EU and there is no EU-CASP involved, it may not be feasible for the
issuer to report such transactions under Article 22(1), point (d) of MiCAR, unless it has a con-
tractual relationship with the third-country firm providing crypto-asset services used by the
payer or by the payee (as applicable). This is because there is no requirement in MiCAR for
third-country firms providing crypto-asset services to report transactional data to the issuer, if
those firms do not provide crypto-assets services in the EU. This interpretation is reflected in
recital 7 and Article 3(5) of the draft RTS.
26. The above is without prejudice to the reporting obligation of issuers under Article 22(1)(c) and
the ITS to be developed under Article 22(1)(7) of MiCAR.
Question 3: Do you agree with the EBA’s proposals regarding the geographical scope of the
transactions covered by Article 22(1), point (d) of MiCAR, as reflected in Article 3(5) of the draft
RTS? If not, please provide your reasoning and the underlying evidence.
Reporting of transactions per single currency area, as referred to in Article 22(1), point
(d) of MiCAR
27. According to Articles 22(1), point (d) and 58(3) of MiCAR, the issuer of an ART or of an EMT
denominated in a non-EU currency is required to report to the competent authority transac-
tions associated to uses of such tokens as a means of exchange “within a single currency area”.
A similar wording is used in Article 23(1), which limits the issuance of an ART when “the esti-
mated quarterly average number and average aggregate value of transactions per day associ-
ated to its uses as a means of exchange within a single currency area is higher than 1 million
transactions and EUR 200 000 000, respectively” [emphasis added]. In accordance with Article
11
58(3) of MiCAR, these provisions in Article 23 also apply to EMTs denominated in a non-EU
currency.
28. In the EBA’s view, the most reasonable interpretation of MiCAR is that, for the purpose of Arti-
cles 22(1), point (d) and 23(1) of MiCAR, a “single currency area” refers to one or several coun-
tries that have the same official currency. A “single currency area” may include, for example,
the euro-area Member States (that shall collectively be a “single currency area”), or a non-euro
area Member State. This is reflected in Article 2(2) of the draft RTS.
29. Furthermore, in the EBA’s view, the reporting in Article 22(1), point (d) of MiCAR covers both:
(i) transactions where the payer and the payee are located in the same single currency area
(within the EU), and (ii) transactions where the payer and the payee are located in different
single currency areas (where at least one of these single currency areas is in the EU).
30. In this regard, the EBA also assessed the alternative interpretation of considering that Article
22(1), point (d) of MiCAR covers only transactions where both the payer and the payee are
located in the same single currency area. However, this would mean excluding from the scope
of the reporting in Article 22(1), point (d), and of the caps in Article 23(1), a potentially high
number of transactions where the payer and the payee are located in different single currency
areas. In the EBA’s view, having discussed with the European Commission, such interpretation
would be contrary to the objectives of MiCAR of preventing risks that the wide use of ARTs and
of EMTs denominated in a non-EU currency may pose to monetary policy transmission and
monetary sovereignty within the EU. Also, in the EBA’s view, this would not be in line with the
policy intention explained in recital 60 of MiCAR, to ensure a “comprehensive monitoring over
the whole ecosystem of asset-referenced tokens issuers” and “capture all transactions that are
conducted with any given asset-referenced token”. For these reasons, the EBA has discarded
this interpretation.
31. Article 4(2) of the draft RTS specifies the criteria for assigning a transaction to a single currency
area for the purpose of Article 22(1), point (d) of MiCAR. More specifically, this Article provides
that, where both the payer and the payee are located in the same single currency area, the
issuer should report the transaction for that single currency area (the transaction should be
reported only once for that single currency area). Where the payer and the payee are located
in different single currency areas, the issuer should report the transaction as a sent transaction
for the single currency area where the payer is located, and as a received transaction for the
single currency area where the payee is located.
32. In the EBA’s view, this interpretation is in line with the objectives of Articles 22(1), point (d) and
23(1) of MiCAR, explained above, of preventing risks that the wide use of ARTs and of EMTs
denominated in a non-EU currency may have on monetary policy transmission and monetary
sovereignty within the EU, through currency substitution effects, given that currency substitu-
tion effects may arise both in the single currency area where the payer is located and in the
single currency area where the payee is located. Moreover, in the EBA’s view, the approach
12
proposed above should allow to correctly reflect in the reporting the different legs of the trans-
action where the payer and the payee are located in different single currency areas.
33. For the purpose of these RTS, the location of the payer or of the payee refers to: (a) for natural
persons, their habitual residence; and (b) for legal persons, the registered office address. The
reference to the ‘habitual residence’ of natural persons is in line with the terminology used in
other EU legislation and in the Consultation Paper on draft RTS on supervisory colleges under
Article 119(8) of MiCAR (EBA/CP/2023/33) and the EBA draft Guidelines under Regulation (EU)
2023/1113 (the Funds Transfer Regulation or ‘FTR’). This is reflected in Article 3(5) of the draft
RTS.
34. The reporting template for issuers to report the transactions referred to in Article 22(1), point
(d) of MiCAR, including the relevant breakdowns for reporting transactions per single currency
area, will be specified in the ITS to be developed under Article 22(7) of MiCAR.
35. Relatedly, the EBA recalls that, in accordance with Article 23(1) of MiCAR, the caps set out in
that Article are counted per single currency area. In this regard, the EBA is of the view that, for
the purpose of applying the caps in Article 23(1):
- A transaction where the payer and the payee are located within the same single currency
area should be counted only once for that single currency area;
- A transaction where the payer and the payee are located in different single currency areas
should be counted both for the single currency area where the payer is located, and for the
single currency area where the payee is located.
36. Furthermore, in the EBA’s view, the most reasonable interpretation of MiCAR is that the obli-
gation in Article 23(1) for the issuer to stop issuing the token applies once the caps in Article
23(1) are reached for a single currency area within the EU, but not when the caps are reached
in a single currency area outside the EU, and not in a single currency area within the EU. In the
EBA’s view, it was not the intention of the co-legislators to automatically limit the issuance of
an ART or of an EMT denominated in a non-EU currency where the caps in Article 23(1) are
reached in a single currency area outside the EU, but not in a single currency area within the
EU, as in such cases the potential impact on monetary policy transmission and monetary sov-
ereignty within the EU is likely be more limited compared to cases where the thresholds are
reached in a single currency area within the EU.
37. In the EBA’s view, this interpretation is supported by the provisions in Article 23(2) of MiCAR,
which requires the competent authority to “use the information provided by the issuer, its own
estimates, or the estimates provided by the ECB or, where applicable, by the central bank re-
ferred to in Article 20(4), whichever is higher, in order to assess whether the threshold referred
to in Article 23(1)] is reached”, without providing for any involvement of foreign central banks
or authorities. In the EBA’s view, this implies that the obligation in Article 23(1) for the issuer
to stop issuing the token applies only where the thresholds are reached for a single currency
area within the EU.
13
38. The above is without prejudice to the provisions in Article 24(3) of MiCAR which provides that
“competent authorities shall limit the amount of an asset-referenced token to be issued or im-
pose a minimum denomination amount in respect of the asset-referenced token when the ECB
or, where applicable, the central bank referred to in Article 20(4), issues an opinion that the
asset-referenced token poses a threat to the smooth operation of payment systems, monetary
policy transmission or monetary sovereignty”.
Question 4: Do you agree with the EBA’s proposals on how issuers should assign the transactions
in scope of Article 22(1)(d) of MiCAR to a single currency area, as reflected in Article 4 of the draft
The calculation of the average number and average aggregate value of transactions re-
ferred to in Article 22(1), point (d) of MiCAR
39. As explained above, according to Articles 22(1), point (d) and 58(3) of MiCAR, the issuer of an
ART or of an EMT denominated in a non-EU currency is required to report to the competent
authority, on a quarterly basis, an estimate of the average number and average aggregate value
of transactions per day during the relevant quarter that are associated to uses of such tokens
as a means of exchange within a single currency area.
40. In this regard, Article 5(1) of the draft RTS specifies that the issuer should calculate the average
number and average aggregate value of transactions per day referred to in Article 22(1), point
(d) of MiCAR, for each single currency area, as this information stands on the following report-
ing reference dates: 31 March, 30 June, 30 September and 31 December. The deadline for the
submission to the competent authority of the information referred to in Article 22(1), point (d)
of MiCAR, after the end of the reporting period (the remittance dates) are specified in the draft
ITS under Article 22(7) of MiCAR.
41. Furthermore, in Article 5(2) of the draft RTS, the EBA is proposing that the value of the trans-
actions referred in Article 22(1), point (d) of MiCAR should be reported in the official currency
of the home Member State of the issuer. Article 5(3) provides further details on the methodol-
ogy for determining the value of transactions with an ART, or an EMT referencing a non-EU
currency, depending on the asset(s) referenced by the respective token.
Question 5: Do you agree with the EBA’s proposals on how issuers should calculate the value of
transactions referred in Article 22(1), point (d) of MiCAR, as reflected in Article 5 of the draft RTS?
If not, please provide your reasoning and the underlying evidence.
14
Data quality and the reconciliation by the issuer of the data reported by CASPs to the
issuer
42. Article 22(3) of MiCAR requires CASPs that provide services related to ARTs to report to the
issuer the information necessary to enable the issuer to report to the competent authority the
information in Article 22(1), including by reporting transactions that are settled outside the
distributed ledger.
43. The data to be reported by CASPs to the issuer in accordance with Article 22(3) will be specified
in the ITS under Article 22(7) of MiCAR. In this regard, in the CP on the draft ITS, the EBA is
proposing that the CASP of the payer and the CASP of the payee should report to the issuer,
among others, the following transactional data: the hash, the distributed ledger address, the
crypto-asset account number of the payer or of the payee, as applicable, the value and date of
the transaction, and the country of the payer and the payee. Moreover, in the draft ITS, the
EBA is proposing that CASPs should report to the issuer the public distributed ledger addresses
they use for making transfers on behalf of their clients, in order to make it easier for issuers to
identify which transactions registered on the distributed ledger take place between non-custo-
dial wallets.
44. The reporting obligations for CASPs under Article 22(3), as specified in the ITS, leverage on the
controls and procedures that should be put in place by CASPs to identify and verify the identity
of their customers and conduct ongoing monitoring of the business relationship with their
customers in accordance with Directive (EU) 2015/849 6 (AMLD). In this regard, the EBA recalls
that custodian wallet providers, as defined in Article 3(19) of the AMLD, and providers of
exchange services between virtual currencies and fiat currencies, as referred to in Article 2(3)(g)
of AMLD, are obliged entities under the AMLD. Furthermore, the recast FTR, which shall apply
from 30 December 2024, brings all CASPs, as defined in MiCAR, within the scope of obliged
entities under the AMLD.
45. This means that all CASPs regulated under MiCAR will be subject to the AML/CFT requirements
under the AMLD, including customer due diligence requirements. Moreover, the recast FTR
requires CASPs to accompany transfers of crypto assets with information on the payer and the
payee (referred to in the FTR as the “originator” and the “beneficiary”). This includes the
obligation of the CASP of the originator to ensure that transfers of crypto-assets are
accompanied, among others, by the following information regarding the originator and the
beneficiary: name, distributed ledger address and crypto-asset account number (where
applicable), as well as information on the originator’s address, official personal document
number and customer identification number, or, alternatively, the originator’s date and place
of birth (see Article 14(1) and (2) of the recast FTR).
6
Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of
the financial system for the purposes of money laundering or terrorist financing
15
46. When reporting the information in Article 22(1), point (d) of MiCAR to the competent author-
ity, the issuer should ensure that the data reported is correct, complete and submitted within
the deadlines specified in the ITS. This is reflected in Article 6(1) of the draft RTS. Furthermore,
Article 6(2) of the draft RTS requires issuers to have systems and procedures in place that allow
them to reconcile, for each transaction, the data reported by the CASP of the payer and the
CASP of the payee to the issuer pursuant to Article 22(3) of MiCAR and the ITS, and the data
available to the issuer from other sources, including, where applicable, transactional data avail-
able on the distributed ledger. This aims to ensure that the data reported by the issuer to the
competent authority pursuant to Article 22(1)(d) is correct and complete, and to avoid double-
counting of transactions reported by the CASP of the payer and the CASP of the payee.
47. The above is without prejudice to the responsibility of CASPs to comply with the reporting re-
quirements in Article 22(3) of MiCAR and the ITS.
Question 6: In your view, does the transactional data to be reported by CASPs to the issuer, as
described in paragraph 43 above, cover the data needed to allow the issuer to reconcile the
information received from the CASP of the payer and the CASP of the payee before reporting the
information in Article 22(1), point (d) of MiCAR to the competent authority? If not, please provide
your reasoning with details and examples of which data should be added or removed.
Question 7: Do you agree that, based on the transactional data to be reported by CASPs to the
issuer as described in paragraph 43 above, issuers will be able to reconcile the data received from
the CASP of the payer and the CASP of the payee on a transactional basis and in automated
manner? If not, what obstacles do you see and how could these be overcome?
The reporting of transactions between non-custodial wallets or between other type of

distributed ledger addresses where there is no CASP involved
48. As explained above, Article 22(1) of MiCAR defines a “transaction”, for the purpose of points
(c) and (d) of Article 22(1), as “any change of the person entitled to the token as a result of the
transfer of the token from one distributed ledger address or account to another” [emphasis
added]. This definition is agnostic to the type of wallets used for performing the transfer, which
can include custodial wallets, non-custodial wallets, or other distributed ledger addresses that
are used for settlement purposes and are not controlled by a user or by a CASP, such as a con-
tract address. A custodial wallet refers to a crypto-asset wallet address where a CASP ensures
the safekeeping or controlling, on behalf of its client, of crypto-assets or of the means of access
to such crypto-assets (where applicable in the form of private cryptographic keys). By contrast,
a non-custodial wallet refers to a crypto-asset wallet address where the user holds the means
of access to the crypto-assets.
49. In developing the methodology referred to in Article 22(6) of MiCAR, the EBA assessed whether
the data to be reported by the issuer pursuant to Article 22(1), point (d) of MiCAR should also
16
cover transactions that take place between non-custodial wallets, or between other types of
distributed ledger addresses that are used for settlement purposes and where there is no CASP
involved. In this regard, the EBA took into account that, while information on such transactions
is relevant for the purposes explained in paragraphs 12-16 above, the issuer would not typically
have the necessary information to report such transactions under Article 22(1), point (d) of
MiCAR. This is because the data available to the issuer on the distributed ledger does not in-
clude information on:
(a) Whether the transfer is made between addresses of different persons or between ad-
dresses of the same person, which means that the issuer may not be able to determine
whether the transfer qualifies as a “transaction” as defined in Article 22(1) of MiCAR,
and therefore whether the transfer should be reported under Article 22(1), point (d) of
MiCAR; and
(b) The location of the payer and the payee, which is needed in order to determine the
relevant single currency areas for which transactions should be reported in accordance
with Article 22(1), point (d) of MiCAR and Article 4 of the draft RTS.
50. In light of the above, the EBA assessed two policy options for the purpose of developing the
methodology referred to in Article 22(6) of MiCAR:
 Option 1 – to require issuers to report under Article 22(1), point (d) of MiCAR transac-
tions between non-custodial wallets or between other type of distributed ledger ad-
dresses where there is no CASP involved, on a best-efforts basis, using the data availa-
ble on the distributed ledger coupled with distributed ledger analytics tools. This would
mean that issuers would need to use distributed ledger analytics tools (such as using
clustering algorithms to link different addresses to a single user) to: (i) inform their as-
sessment of which transfers between non-custodial wallets qualify as “transactions”
within the meaning of Article 22(1) and (ii) identify the location of the payer and the
payee, in order to determine the relevant single currency areas for which transactions
should be reported.
 Option 2 – to not require issuers to report under Article 22(1), point (d) of MiCAR trans-
actions between non-custodial wallets or between other types of distributed ledger
addresses where there is no CASP involved, and to include instead in the ITS under
Article 22(7) of MiCAR a requirement for issuers to report under Article 22(1), point (c)
of MiCAR (i) the number and value of such transactions (on a best efforts basis), as well
as (ii) the number and value of all transfers between non-custodial wallets or between
other types of distributed ledger addresses where there is no CASP involved 7.
51. In the EBA’s view, the advantage of Option 1 is that it would provide more granular data, com-
pared to Option 2, on how many transactions between non-custodial wallets or between other
7
The concept of “transfers”, as used in the draft ITS, is broader than “transactions”, as defined in Article 22(1) of MiCAR,
as it includes any transfer with a token in scope, regardless of whether the transfer is made between addresses of
different persons or between addresses of the same person.
17
types of distributed ledger addresses where there is no CASP involved are associated to uses of
an ART or of an EMT denominated in a non-EU currency as a means of exchange for each single
currency area. However, this more granular data would be, at most, a rough approximation and
unreliable. This is because currently there is no accurate way for issuers of determining, in the
case of transfers where there is no CASP involved, (i) whether the transfer is made between
addresses of different persons or between addresses of the same person (in which case it
should not be reported because it would not qualify as a “transaction” within the meaning of
Article 22(1), point (d) of MiCAR), and (ii) the relevant single currency areas for which transac-
tions should be reported based on the location of the payer and of the payee.
52. Moreover, in the EBA’s view, Option 1 would lead to higher implementation costs for issuers
compared to Option 2 (costs related to using distributed ledger analytics tools), although the
EBA does not have reliable data as regards the estimated level of such costs. In addition, Option
1 may lead to unlevel playing field issues as regards the application of the caps in Article 23(1)
of MiCAR (which, as explained above, are counted per single currency area), where issuers use
different methodologies for determining (i) which transfers qualify as a “transaction” within
the meaning of Article 22(1), and/or (ii) the location of the payer and of the payee, which shall
determine the single currency area(s) for which the transaction should be reported. Also, Op-
tion 1 may inadvertently create incentives for issuers to underreport such transactions under
Article 22(1), point (d) of MiCAR to avoid reaching the caps in Article 23(1) of MiCAR.
53. In the EBA’s view, Option 2 would be easier and less costly for issuers to implement compared
to Option 1. Also, Option 2 would allow competent authorities and the EBA to have visibility on
the number and value of transfers between non-custodial wallets or between other type of
distributed ledger addresses where there is no CASP involved, with the possibility to introduce
more detailed requirements for such transactions at a later stage, depending on the evolution
of the market (e.g, should the volume and value of these transactions become significant).
54. On the other hand, as mentioned above, Option 2 would provide less information to competent
authorities on transactions carried out between non-custodial wallets, or between other type
of distributed ledger addresses where there is no CASP involved. Also, Option 2 may inadvert-
ently create incentives for the market to promote the use of non-custodial wallets or of other
types of distributed ledger addresses where there is no CASP involved for making payments, to
circumvent the more granular reporting requirements for transactions between custodial wal-
lets or between a custodial wallet and a non-custodial wallet.
55. Having assessed the pros and cons of these options, the EBA arrived at the preliminary view
that Option 2 would be preferable, as it would strike a good balance between the quality of the
data obtained, on the one hand, and compliance costs on the other hand. This is reflected in
recital 3 and Article 3(3) (b) of the draft RTS. The EBA will further assess these aspects after the
public consultation, in light of the responses to the public consultation and further analysis to
be conducted as regards the reporting of transactions between non-custodial wallets, or be-
tween other type of distributed ledger addresses where there is no CASP involved. To inform
this assessment, EBA is seeking feedback from external stakeholders on the methods that could
18
be used by issuers to determine (i) whether a transfer between such type of wallets/addresses
is made between addresses of different persons, or between addresses of the same person,
and (ii) the location of the payer and of the payee in such cases.
Question 8: In your view, how can an issuer estimate, in the case of transactions between non-
custodial wallets, or between other type of distributed ledger addresses where there is no CASP
involved: (i) whether the transfer is made between addresses of different persons or between
addresses of the same person, and (ii) the location of the payer and of the payee? Please describe
the analytics tools and methodology that could be used for determining such aspects, and indicate
what would be, in your view, the costs associated to using such tools and the degree of accuracy
of the estimates referred to above?
Question 9: Do you consider the EBA’s proposals set out in recital 2 of the draft RTS and further
explained in paragraphs 48-55 above as regards the reporting of transactions between non-
custodial wallets and between other type of distributed ledger addresses where there is no CASP
involved to be achieving an appropriate balance between the competing demands of ensuring a
high degree of data quality and imposing a proportionate reporting burden? If not, please provide
your reasoning and the underlying evidence.
19
CP ON THE RTS ON THE USE OF ARTS AND EMTS DENOMINATED IN A NON-EU CURRENCY AS A MEANS OF EXCHANGE UNDER ART.
22(6) AND 58(3) OF MICAR
5. Draft regulatory technical standards
20
of XXX

Council on markets in crypto-assets with regard to regulatory technical standards
specifying the methodology to estimate the number and value of transactions
associated to uses of asset-referenced tokens as a means of exchange under Article
22(1) point (d) of Regulation (EU) 2023/1114 and of e-money tokens denominated in a
currency that is not an official currency of a Member State pursuant to Article 58(3)
of that Regulation

on markets in crypto-assets, and amending Regulations (EU) No 1093/2010 and (EU) No
1095/2010 and Directives 2013/36/EU and (EU) 2019/1937 8, and in particular to Article
22(6) third subparagraph thereof,
Whereas:
(1) Having regard to the definition of “transactions” in Article 22(1), second subpara-
graph of Regulation (EU) 2023/1114 and recital 60 of that Regulation, the methodol-
ogy to be specified according to Article 22(6) of that Regulation should consider that
such definition includes transactions settled on the distributed ledger (‘on-chain’) and
transactions settled outside the distributed ledger (‘off-chain’). It should also include
all transactions that lead to a change in the legal person entitled to the asset-referenced
token, even where the beneficial owner, as defined in Article 3, point 6 of Directive
(EU) 2015/849 of the European Parliament and of the Council 9, remains the same.
This is without prejudice to the obligations of obliged entities under Directive
2015/849 to conduct customer due diligence on their customers, including in relation
to the identification of beneficial owners. For the purpose of the reporting under Ar-
ticle 22(1), point (d) of Regulation (EU) 2023/1114, the data to be reported by the
issuer to the competent authority in accordance with that Article should not include
transfers of an asset referenced token between different addresses or accounts of the
same person as these transfers do not qualify as a “transaction” within the meaning of
Article 22(1) of that Regulation.
8
and amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU)
2019/1937 (OJ L 150, 9.6.2023, p. 40–205)
9
Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of
the �inancial system for the purposes of money laundering or terrorist �inancing, amending Regulation (EU) No
648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parlia-
ment and of the Council and Commission Directive 2006/70/EC (OJ L 141, 5.6.2015, p. 73)
21
(2) The definition of a “transaction” in Article 22(1) of Regulation (EU) 2023/1114 is

agnostic to the type of wallets used by the payer or by the payee for initiating or re-
ceiving a transaction associated to the use of an asset referenced token as a means of
exchange. Accordingly, for specifying the methodology according to Article 22(6) of
Regulation (EU) 2023/1114 it is necessary to consider that the reporting in Article
22(1), point (d) of that Regulation should include transactions between custodial wal-
lets as well as transactions between a custodial wallet and a non-custodial wallet.
Transactions between non-custodial wallets, or between non-custodial wallets and
other types of distributed ledger addresses that are used for settlement purposes and
are not controlled by a user or by a crypto asset service provider, should be excluded
from the scope of the reporting in Article 22(1), point (d) of Regulation (EU)
2023/1114, taking into account that issuers do not have the necessary information to
report these transactions under those provisions. This is without prejudice to the re-
porting obligations of issuers in respect of such transactions under Article 22(1), point
(c) of Regulation (EU) 2023/1114 and the Commission Delegated Regulation (EU)
2023/xx [ITS].
(3) The issuer should estimate the number and value of transactions associated to uses of
an asset-referenced token as a means of exchange as referred to in Article 22(1), point
(d) of Regulation (EU) 2023/1114 by deducting from the total number and value of
transactions settled in the asset referenced token, during the relevant quarter, transac-
tions associated with the exchange of the asset referenced token for funds or other
crypto-assets with the issuer or with a crypto-asset service provider.
(4) By derogation from the above, transactions associated with the exchange of an asset
referenced token for funds or other crypto-assets with the issuer or with a crypto-asset
service provider should be considered associated to uses of the asset-referenced token
as a means of exchange where the asset-referenced token is used for the settlement of
transactions in other crypto-assets. An asset referenced token should be considered to
be used for settlement of transactions in other crypto-assets where a transaction in-
volving two legs of crypto-assets, which are different from the asset-referenced to-
kens, is settled in that asset-referenced token.
(5) The issuer should determine for each transaction in scope of Article 22(1), point (d)
of Regulation (EU) 2023/1114 the single currency area(s) for which that transaction
should be reported, in accordance with the methodology set out in this Regulation. In
line with the objective of Regulation (EU) 2023/1114 of monitoring risks that the
wide use of asset referenced tokens may pose to financial stability, smooth operation
of payment systems, monetary policy transmission and monetary sovereignty, the
transactions referred to in Article 22(1), point (d) of that Regulation should cover both
transactions where the payer and the payee are located in the same single currency
area, and transactions where the payer and the payee are located in different single
currency areas.
(6) Where both the payer and the payee are located in the same single currency area, the
issuer should assign the transaction to that single currency area. Where the payer and
the payee are located in different single currency areas, the issuer should assign the
22
transaction as a sent transaction for the single currency area where the payer is located,
and as a received transaction for the single currency area where the payee is located.
This should allow to correctly reflect in the reporting the different legs of the transac-
tion and to monitor risks that the wide use of an asset referenced token as a means of
exchange may pose to monetary policy transmission and monetary sovereignty, tak-
ing into account that currency substitution effects can arise both in the single currency
area where the payer is located and in the single currency area where the payee is
located.
(7) The transactions to be reported under Article 22(1), point (d) of Regulation (EU)
2023/1114 should include transactions where at least the payer or the payee is located
in the European Union. By contrast, transactions where both the payer and the payee
are located outside the European Union should be excluded from the scope of the
reporting in that Article, taking into account that such latter transactions would be
unlikely to endanger monetary policy transmission and monetary sovereignty within
the European Union.
(8) To ensure that the data reported to the competent authority pursuant to Article 22(1),
point (d) of Regulation (EU) 2023/1114 is correct and complete, the issuer should
have systems and procedures in place that allows it to reconcile the data received for
each transaction from the crypto-asset service provider of the payer and the crypto-
asset service provider of the payee (where applicable) pursuant to Article 22(3) of
Regulation (EU) 2023/1114 and the Commission Delegated Regulation (EU) 2023/xx
[ITS]. These systems and procedures should also allow the issuer to reconcile the data
reported by crypto-asset service providers with the data available to the issuer from
other sources, including, where applicable, transactional data available on the distrib-
uted ledger.
(9) In accordance with Article 58(3) of Regulation (EU) 2023/1114, the provisions of Ar-
ticles 22, 23 and 24(3) of that Regulation shall also apply to e-money tokens denom-
inated in a currency that is not an official currency of a Member State. Accordingly,
this Regulation should also apply mutatis mutandis to such tokens.
(10) This Regulation is based on the draft regulatory technical standards submitted by the
European Supervisory Authority (the European Banking Authority (EBA)) to the
Commission.
(11) EBA has conducted open public consultations on the draft regulatory technical stand-
ards on which this Regulation is based, analysed the potential related costs and bene-
fits and requested the opinion of the Banking Stakeholder Group established in ac-
cordance with Article 37 of Regulation (EU) No 1093/2010 10.
10
Commission Decision 2009/78/EC (OJ L 331 15.12.2010, p. 12)
23
Article 1
Subject matter
1. This Regulation specifies the methodology to estimate the quarterly average number and
average aggregate value of transactions per day that are associated to uses of an asset-
referenced token as a means of exchange within a single currency area, in accordance with
Article 22(1), point (d) of Regulation (EU) 2023/1114.
2. In accordance with Article 58(3) of Regulation (EU) 2023/1114, this Regulation shall also
apply mutatis mutandis to e-money tokens denominated in a currency that is not an official
currency of a Member State.
Article 2
Definitions
For the purposes of this Regulation, the following definitions shall apply:
(1) ‘single currency area’ means one or several countries that have the same official
currency;
(2) ‘custodial wallet’ means a crypto-asset wallet address where a crypto-asset service
provider ensures the safekeeping or controlling, on behalf of its client, of crypto-
assets or of the means of access to such crypto-assets, where applicable in the form
of private cryptographic keys;
(3) ‘non-custodial wallet’ means a crypto-asset wallet address where the user controls
the means of access to the crypto-assets, where applicable in the form of private
cryptographic keys.
Article 3
Scope of the transactions associated to uses of an asset referenced token as a means of
exchange
1. The issuer shall estimate the number and value of transactions associated to uses of an
asset-referenced token as a means of exchange, as referred to in Article 22(1), point (d) of
Regulation (EU) 2023/1114, by deducting from the total number and value of transactions
with the asset-referenced token during the relevant quarter, the transactions associated with
the exchange of the asset-referenced token for funds or other crypto-assets with the issuer
or with a crypto-asset service provider.
2. By derogation from paragraph 1, transactions associated to uses of an asset-referenced
token as a means of exchange shall include the exchange of an asset-referenced token for
24
funds or other crypto-assets with the issuer or with a crypto-asset service provider where
the asset-referenced token is used for settlement of transactions in other crypto-assets.
3. Transactions associated to uses of an asset-referenced token as a means of exchange shall
include:
(a) transactions settled on a distributed ledger and transactions settled outside a dis-
tributed ledger;
(b) transactions between custodial wallets and transactions between a custodial wallet
and a non-custodial wallet or other type of distributed ledger addresses that is not
controlled by a user or a crypto-asset service provider.
4. The transactions referred to in paragraph 1 shall exclude transfers between the same ac-
counts or addresses of the same person.
5. The transactions referred to in paragraph 1 shall include transactions where at least the
payer or the payee is located in the European Union. The location of a payer or a payee
refers to their habitual residence, for natural persons, and to the registered office address,
for legal persons.
Article 4
Assigning of transactions by single currency area
The issuer shall determine for each transaction in scope of Article 22(1), point (d) of Regu-
lation (EU) 2023/1114 the single currency area(s) for which that transaction shall be re-
ported, as follows:
(a) Where both the payer and the payee are located in the same single currency area, the
issuer shall assign the transaction for that single currency area.
(b) Where the payer and the payee are located in different single currency areas, the issuer
shall assign the transaction as a sent transaction for the single currency area where the
payer is located and as a received transaction for the single currency area where the
payee is located.
Article 5
Calculation of the average number and average aggregate value of transactions
1. The issuer shall calculate the quarterly average number and average aggregate value of
transactions per day referred to in Article 22(1), point (d) of Regulation (EU) 2023/1114
for each single currency area, as this information stands on the following reporting refer-
ence dates: 31 March, 30 June, 30 September and 31 December.
2. The value of the transactions referred in paragraph 1 shall be reported in the official cur-
rency of the home Member State of the issuer.
3. The issuer shall determine the value of the transactions referred to in paragraph 1 as fol-
lows:
25
(a) Where the basket of assets referenced by the asset referenced token includes one
or more official currencies that are different from the official currency referred to
in paragraph 2, the issuer shall determine the value of the respective transactions
per day by using the relevant exchange rates applicable at the end of each calendar
day during the applicable reporting period in accordance with the valuation, or the
principles of valuation, of the asset referenced token referred to in Article 39(2),
letter (c) of Regulation (EU) 2023/1114.
(b) Where the basket of assets referenced by the asset referenced token includes assets
other than an official currency, the issuer shall determine the value of the respective
transactions per day by using market prices calculated at the end of each calendar
day during the applicable reporting period, whenever possible, in accordance with
the valuation, or the principles of valuation, of the asset referenced token referred
to in Article 39(2), letter (c) of Regulation (EU) 2023/1114 and Article 36(11) and
(12) of that Regulation.
(c) Where the official currency referenced by the e-money token is different from the
official currency referred to in paragraph 2, the issuer shall determine the value of
the respective transactions per day by using the relevant exchange rates applicable
at the end of each calendar day during the applicable reporting period.
Article 6
Data quality
1. The issuer shall have systems and procedures in place to ensure that the data submitted to
the competent authority pursuant to Article 22(1), point (d) of Regulation (EU) 2023/1114
is correct, complete and submitted within the timeframe specified in the Commission Del-
egated Regulation (EU) No xx/xx [ITS].
2. The systems and procedures referred to in paragraph 1 shall allow issuers to reconcile,
for each transaction, the data received from the crypto-asset service provider of the payer
and the crypto-asset service provider of the payee pursuant to Article 22(3) of Regulation
2023/1114 and the Commission Delegated Regulation (EU) No xx/xx [ITS], as well as to
reconcile this data with the data available to the issuer from other sources, including,
where applicable, transactional data available on the distributed ledger.
Article 7
Final provisions
26
Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
27

According to Article 10 of Regulation (EU) No 1093/2010 (EBA Regulation), the EBA shall analyse
the potential costs and benefits of draft regulatory standards (RTS) developed by the EBA. RTS
developed by the EBA shall therefore be accompanied by an Impact Assessment (IA), which
analyses ‘the potential related costs and benefits.'
This analysis presents the draft IA of the main policy options regarding the draft RTS on the
methodology to estimate the number and value of transactions associated to uses of asset-
referenced tokens as a means of exchange under Article 22(6) of Regulation (EU) No 2023/1114
(MiCAR).
MiCAR sets out a new legal framework for the issuers of asset-referenced tokens (ARTs) and e-
money tokens (EMTs). This includes the obligation of issuers of ARTs and of EMTs denominated in
a non-EU currency to report, on a quarterly basis, to the competent authority an estimate of the
average number and average aggregate value of transactions per day during the relevant quarter
that are associated to uses of an ART or of an EMT denominated in a non-EU currency as a means
of exchange within a single currency area. This reporting obligation applies for each ART and EMT
denominated in a non-EU currency with an issue value that is higher than EUR 100 000 000, and
where the competent authority so decides in accordance with paragraph 2 of Article 22, also for
ARTs and EMTs denominated in a non-EU currency with a value of less than EUR 100 000 000. As
explained in the Rationale section of the Consultation paper on these draft RTS, means of exchange
in the context of the draft RTS is understood as the use of an ART or an EMT denominated in a non-
EU currency for the purpose of payment of goods and services.
To enable issuers to report this information, MiCAR requires crypto asset service providers (CASPs)
that provide services related to ARTs and EMTs denominated in a non-EU currency to report to the
issuer the information necessary for issuers to prepare such reports, including by reporting
transactions that are settled outside the distributed ledger. The information that CASPs should
report to the issuer in accordance with MiCAR will be specified in the implementing technical
standards (ITS) to be developed under Article 22(7) of MiCAR (EBA/CP/2023/32). In this regard, the
costs and benefits for CASPs for complying with those requirements are covered in the draft IA on
the Consultation Paper on those ITS, and are not repeated in this IA.
While the requirement for issuers to report the estimates mentioned above is clearly specified in
MiCAR, the text does not specify how these estimates should be calculated. Due to the fact that
the legal framework introduced by MiCAR is new, there is no established methodology to calculate
estimates of the number and value of transactions associated to uses of ARTs and EMTs
28
denominated in a non-EU currency “as a means of exchange within a single currency area”, as
referred to in MiCAR. Moreover, currently there is limited data available particularly with regard to
the geographical location of the parties to such transactions, as well as information whether the
transfers of such tokens are made between addresses of different persons or between addresses
of the same person.
The general objective of the draft RTS is to clarify the reporting obligation of issuers in accordance
with MiCAR and to support the objectives of MiCAR of ensuring that the data reported allows to:
- monitor and prevent risks that the wide use of ARTs and of EMTs denominated in a
non-EU currency as a means of exchange may have on monetary policy transmission
and monetary sovereignty within the EU, through currency substitution effects;
- assess whether an ART or an EMT denominated in a non-EU currency meets the criteria
in Articles 43(1) and 56(1) of MiCAR to be classified as significant.
The draft RTS also aims to ensure that issuers apply a similar and harmonized methodology to
estimate the number and aggregate value of transactions associated with the use of an ART or of
an EMT denominated in a non-EU currency as a means of exchange within a single currency area.
In a baseline scenario, the issuers of ART and EMTs denominated in a non-EU currency would need
to apply the MiCAR requirements to report an estimate of the number and aggregate value of
transactions associated to means of exchange within a single currency area, without a clear
methodology on how to report such transactions or guidance on the transactions in scope of the
reporting. This scenario would lead to divergent approaches and interpretation on how such
estimates are calculated and reported. This would lead to competent authorities having data that
is not comparable. Moreover, such a divergence in approaches may lead to unreliable estimates
which will create level playing field issues, and would not meet the objectives of MiCAR explained
above.
The costs and benefits of the underlying Regulation, i.e. MiCAR, are not assessed within this impact
assessment.
D. Policy issues, options considered
Policy issue 1: Reconciliation of data received from CASPs
Articles 22(3) and 58(3) of MiCAR requires CASPs that provide services related to ARTs and EMTs
denominated in a non-EU currency to report to the issuer the information necessary to enable the
29
issuer to report to the competent authority the information in Article 22(1), including by reporting
transactions that are settled outside the distributed ledger. The following two policy options were
considered:
Option 1A: Issuers can report to the competent authority aggregated data received from CASPs
without further reconciliation.
Option 1B: Issuers will receive transaction level data from CASPs and should reconcile the data
before reporting it in an aggregated form to the competent authority.
Option 1A would imply no or lower costs for the issuer, compared to Option 1B, but may lead to
less reliable estimates, because of the double counting of transactions where the payer and the
payee use different CASPs, or because of mistakes in the reporting from CASPs. This in turn will lead
to less reliable data on volumes and values of transactions, which will also impact the application
of the caps in Article 23 of MiCAR and would not allow to properly monitor risks that the wide use
of ARTs and of EMTs denominated in a non-EU currency as a means of exchange may have on
monetary policy transmission and monetary sovereignty within the EU. Also, the issuer, who is
ultimately responsible for the data, will have less control over its quality.
Under Option 1B, the issuer should conduct a reconciliation of the data received from the CASP of
the payer and the CASP of the payee. This option can allow for more reliable estimates to be
reported to the competent authority, avoiding double counting of transactions where the payer
and payee use different CASPs. This option however would entail costs associated with data
processing.
Given that the ultimate responsibility for the quality of the data reported to competent authorities
pursuant to Article 22(1) of MiCAR lies with the issuer, and due to the unreliability of estimates if
transactions between wallets hosted by different CASPs would be double counted, Option 1B is
preferred.
Policy issue 2: Reporting of transactions between non-custodial wallets
Option 2A: issuers to report transactions under Article 22(1)(d) of MiCAR between non-custodial
wallets or between other type of distributed ledger addresses where there is no CASP involved on a
best-efforts basis, using the data available on the distributed ledger coupled with distributed ledger
analytics tools.
Option 2B: issuers not to report under Article 22(1)(d) of MiCAR transactions between non-custodial
wallets or between other type of distributed ledger addresses where there is no CASP involved, and
to report under Article 22(1)(c) and the ITS under Article 22(7) of MiCAR (i) the number and value of
such transactions (on a best efforts basis), as well as (ii) the number and value of all transfers
between such wallets or distributed ledger addresses.
Option 2A would provide more granular data, compared to Option 2B, on how many transactions
between non-custodial wallets or between other type of distributed ledger addresses where there
30
is no CASP involved are associated to uses of an ART or of an EMT denominated in a non-EU

currency as a means of exchange for each single currency area.
On the other hand, this more granular data would be, at most, a rough approximation and
unreliable. This is because currently there is no accurate way for issuers of determining, in the case
of transfers where there is no CASP involved, (i) whether the transfer is made between addresses
of different persons or between addresses of the same person, and (ii) the location of the payer
and of the payee, which is needed in order to assign transactions to the relevant single currency
area. This option is also expected to have higher implementation costs for issuers related to using
distributed ledger analytics tools compared to Option 2B.
In this context, due to the issuers using different methodologies for determining (i) which transfers
qualify as a “transaction” within the meaning of Article 22(1), and/or (ii) the location of the payer
and of the payee, which is needed in order to determine the single currency area(s) for which the
transaction should be reported, Option 2A may also lead to unlevel playing field issues as regards
the application of the caps in Article 23 which are counted per single currency area.
Option 2B would be easier and less costly for issuers to implement. It would allow competent
authorities and EBA to have visibility on the number and value of transfers between non-custodial
wallets or between other type of distributed ledger addresses where there is no CASP involved,
with the possibility to introduce more detailed requirements for such transactions at a later stage,
depending on the evolution of the market (e.g, should the volume and value of these transactions
become significant).
However, this option may inadvertently create incentives for the market to promote the use of
non-custodial wallets or of other type of distributed ledger addresses where there is no CASP
involved, for making payments, to circumvent the more granular reporting requirements for
transactions between custodial wallets or between a custodial wallet and a non-custodial wallet.
Overall, the EBA arrived at the preliminary view that option 2B would be preferable as it would
strike a good balance between the quality of the data obtained, on the one hand, and compliance
costs on the other hand. As explained in paragraph 55 of the Rationale section of this CP, the EBA
will further assess these aspects after the public consultation, in light of the responses to the public
consultation and further analysis to be conducted as regards the reporting of transactions between
non-custodial wallets, or between other type of distributed ledger addresses where there is no
CASP involved.
E. Cost and benefit analysis
When comparing with the baseline scenario (where the issuer will need to report information
without a clear methodology or guidance on the transactions in scope of the reporting), the RTS is
expected to bring benefits by achieving a higher level of harmonisation of methodology,
comparability of data, and better data quality. This in turn will contribute to more effective
supervision and monitoring of the use of ARTs and of EMTs denominated in a non-EU currency as
31
a means of exchange and of risks to monetary policy transmission and monetary sovereignty within
the EU, in line with the MiCAR requirements. In that way, these RTS contribute to ensuring the
safety and soundness of the European financial system.
The RTS is expected to lead to moderate costs to issuers in relation to the application of the
methodology. These costs are associated with the reconciliation of the data and the data quality
checks. Given the novelty of the requirements introduced by MiCAR, the EBA does not have at this
stage reliable quantitative data to estimate actual costs of implementation of the RTS, however
these costs are expected to be moderate, given that the costs of the RTS are only incremental to
the costs for implementing the existing reporting requirements set out in MiCAR.

Question 1: Do you agree with the EBA’s proposals on how issuers should estimate the number and
value of transactions associated to uses of an ART or of an EMT denominated in a non-EU currency
“as a means of exchange”, as reflected in Article 3 of the draft RTS? If not, please provide your
reasoning and the underlying evidence, and suggest an alternative approach for estimating the
number and value of these transactions.
Question 2: Please describe any observed or foreseen use cases where transactions involving two
legs of crypto-assets, that are different from an ART, are settled in the ART, as referred to in recital
61 of MiCAR.
Question 3: Do you agree with the EBA’s proposals regarding the geographical scope of the
transactions covered by Article 22(1), point (d) of MiCAR, as reflected in Article 3(5) of the draft
Question 4: Do you agree with the EBA’s proposals on how issuers should assign the transactions
in scope of Article 22(1)(d) of MiCAR to a single currency area, as reflected in Article 4 of the draft
Question 5: Do you agree with the EBA’s proposals on how issuers should calculate the value of
transactions referred in Article 22(1), point (d) of MiCAR, as reflected in Article 5 of the draft RTS?
If not, please provide your reasoning and the underlying evidence.
Question 6: In your view, does the transactional data to be reported by CASPs to the issuer, as
described in paragraph 43 above, cover the data needed to allow the issuer to reconcile the
information received from the CASP of the payer and the CASP of the payee before reporting the
information in Article 22(1), point (d) to the competent authority? If not, please provide your
reasoning with details and examples of which data should be added or removed.
Question 7: Do you agree that, based on the transactional data to be reported by CASPs to the
issuer as described in paragraph 43 above, issuers will be able to reconcile the data received from
32
the CASP of the payer and the CASP of the payee on a transactional basis and in automated manner?
If not, what obstacles do you see and how could these be overcome?
Question 8: In your view, how can an issuer estimate, in the case of transactions between non-
custodial wallets, or between other type of distributed ledger addresses where there is no CASP
involved: (i) whether the transfer is made between addresses of different persons, or between
addresses of the same person, and (ii) the location of the payer and of the payee? Please describe
the analytics tools and methodology that could be used for determining such aspects, and indicate
what would be, in your view, the costs associated to using such tools and the degree of accuracy of
the estimates referred to above?
Question 9: Do you consider the EBA’s proposals set out in recital 3 of the draft RTS and further
explained in paragraphs 48-55 above as regards the reporting of transactions between non-
custodial wallets and between other type of distributed ledger addresses where there is no CASP
involved to be achieving an appropriate balance between the competing demands of ensuring a
high degree of data quality and imposing a proportionate reporting burden? If not, please provide
your reasoning and the underlying evidence.
33
EBA/CP/2023/27
08 NOVEMBER 2023
Consultation Paper
Draft Guidelines establishing the common reference parameters of

the stress test scenarios for the liquidity stress tests referred in
Article 45(4) Regulation (EU) 2023/1114
CONSULTATION PAPER ON DRAFT GUIDELINES ESTABLISHING THE COMMON REFERENCE PARAMETERS
OF THE STRESS TEST SCENARIOS FOR THE LIQUIDITY STRESS TESTS REFERRED IN ARTICLE 45(4)
REGULATION (EU) 2023/1114
Contents
1.Responding to this consultation 3
2.Executive Summary 4
3.Background and rationale 5
4.Draft guidelines 10
5.Accompanying documents 21
5.1Draft cost-benefit analysis / impact assessment 21
5.2Overview of questions for consultation 25
2


Please clearly indicate in the consultation form if you wish your comments to be disclosed or to
be treated as confidential. A confidential response may be requested from us in accordance with
the EBA’s rules on public access to documents. We may consult you if we receive such a request.
Any decision we make not to disclose the response is reviewable by the EBA’s Board of Appeal
and the European Ombudsman.
Data protection
The protection of individuals with regard to the processing of personal data by the EBA is based
on Regulation (EU) 1725/2018 of the European Parliament and of the Council of 23 October 2018.
website.
3
Article 45(4) of Regulation (EU) 2023/1114 of the European Parliament and the Council1 requires
issuers of significant assets referenced tokens to conduct liquidity stress testing on a regular basis.
The requirement of carrying out the said regular liquidity stress testing applies as well to electronic
money (e-money) institutions issuing e-money tokens that are significant by virtue of Article 58(1),
point (a), of Regulation (EU) 2023/1114 and can be expanded to issuers of assets referenced tokens
that are not significant as well as to e-money institutions issuing e-money tokens that are not
significant, if the competent authority of the home Member State requires it so following Article
35(4) and Article 58(2) of Regulation (EU) 2023/1114, respectively.
The supervisory authority, based on the outcome of the liquidity stress testing, may decide to
strengthen the liquidity requirements related to the management of the reserve of assets and to
the minimum content of the liquidity management policy and procedures, mainly.
With these Guidelines (GL) the EBA is complying with its mandate in Article 45(8) of Regulation (EU)
2023/1114 to establishing, in close cooperation with ESMA and the ECB, the common reference
parameters of the stress test scenarios to be included in the liquidity stress testing. Regulation (EU)
2023/1114 requires to update the GL periodically taking into account the latest market
developments.
In the development of the mandate the EBA is taking into account Regulation (EU) 2023/1114 and
the draft RTS to specify the highly liquid financial instruments in the reserve of assets, under Article
38(5), the draft RTS to specify the minimum content of the liquidity management policy and
procedures, under Article 45(7)(b) and the draft RTS further specifying the liquidity requirements
of the reserve of assets, under Article 36(4). These draft RTS are being publicly consulted in parallel
to these draft Guidelines.
Next steps
The guidelines will be translated into the official EU languages and published on the EBA website.
The deadline for competent authorities to report whether they comply with the guidelines will be
two months after the publication of the translations. The EBA will finalise these guidelines once the
consultation responses have been assessed.
1
(OJ L 150, 9.6.2023, p. 40–205)”.
4
CONSULTATION PAPER ON DRAFT GUIDELINES ESTABLISHING THE COMMON REFERENCE PARAMETERS OF
THE STRESS TEST SCENARIOS FOR THE LIQUIDITY STRESS TESTS REFERRED IN ARTICLE 45(4) REGULATION
(EU) 2023/1114

1. Issuers of significant assets referenced tokens (ARTs) and e-money institutions issuing significant e-
money tokens (EMTs) (as well as issuers of ARTs that are not significant and e-money institutions
issuing EMTs that are not significant, both if required by the relevant competent authority of the
home Member State)2 are required in Regulation (EU) 2023/1114 to conduct liquidity stress testing
on a regular basis.
2. The liquidity stress testing will help issuers of tokens to better manage their reserve of assets and
generally their liquidity risk. Based on the outcome of the liquidity stress testing the EBA or, where
applicable, the relevant competent authority/supervisor, may decide to strengthen the liquidity
requirements of the issuer as indicated by Article 45(4) Regulation (EU) 2023/1114:
a. By ensuring an effective and prudent management of the reserve of assets, aimed to

ultimately cover the amount of the assets referenced, such that the redemption of the
tokens upon request of their holders at any time, including during stress, can be done
with the reserve of assets, and to ensure that every issuance of tokens is accompanied
by an increase of the reserve of assets.
b. By reinforcing the minimum content in the liquidity policy management and

procedures of issuers as established in the [RTS XXX/2024 specifying the minimum
content of the liquidity management policy and procedures of issuers under Article
45(7)(b) Regulation (EU) 2023/1114].
3. Article 45(8) Regulation (EU) 2023/1114 mandates the EBA to issue guidelines with a view to estab-
lishing the common reference parameters of the stress test scenarios to be included in the liquidity
stress testing. The EBA shall update the guidelines periodically taking into account the latest market
developments.
4. First, the EBA identifies in these guidelines the parameters that need to be analysed under the li-
quidity stress testing to cover the relevant risks. Second, following application of the guidelines, the
supervisor may strengthen the liquidity requirements of the issuer to cover those risks based on
the outcome of the liquidity stress testing. For example, by setting a higher amount of the reserve
of assets, a higher diversification of its composition or a shorter maturity of the assets, that will
ensure under different stress scenarios their rapid liquidation with minimal liquidity, credit, market
and concentration risk and a prompt execution of any redemption request by token holders; or by
2
As envisaged in paragraph 4 of Article 45 (on significant ARTs) in conjunction with paragraph 1 of Article 58 (on significant
EMTs issued by e-money institutions), paragraph 4 of Article 35 (on non-significant ARTs) and paragraph 2 of Article 58 (on
non-significant EMTs issued by e-money institutions).
5
(EU) 2023/1114
strengthening the contingency policy of the issuer with reinforced early warning signals or mitiga-
tion tools upon potential stress scenarios.
5. The next items in the background describe the risks that the EBA has identified to be covered in the
liquidity stress testing and the methodology identifying the common reference parameters of the
stress test scenarios to be included in the liquidity stress testing to be applied.
6. As a background, it should be noted that following Regulation (EU) 2023/1114 and the RTS
XXX/2024 specifying the highly liquid financial instruments under Article 38(5) Regulation (EU)
2023/1114 , the reserve of assets may be composed of the following assets:
a. Deposits with credit institutions (they should amount to at least 30% of the assets
referenced in each official currency – 60% if the token is significant – and to a minimum
credit quality such that there is no reason to expect non-performance), commodities
and other assets that are received in the issuance of the token and are not invested.
The deposits held with credit institutions are subject to the following maximum
concentration limits by deposit counterparty:
i. 10% of the reserve of assets, or 5% if the credit institution receiving the

deposits is not a large institution; and
ii. 2.5% of the total assets of the institution taking the deposits.
b. Highly liquid financial instruments at market value in which the issuer may invest:
i. LCR Level 1 (L1), as defined in Commission Delegated Regulation (EU)

2015/61 3 , assets subject to 0% haircut, mainly exposures to central
government and central banks. Securities here are subject to a concentration
limit by issuer/guarantor of 35% of the reserve of assets.
ii. L1 covered bonds, capped at 35% of the reserve of assets and subject to a
concentration limit by issuer/guarantor of 10% of the reserve of assets.
iii. Financial instruments used as assets referenced subject to a concentration

limit by securities issuer/guarantor of 5% of the reserve of assets.
iv. Derivatives exposures, for the purposes of the valuation of other highly liquid
financial instruments, with a concentration limit of 5% of the reserve of assets
(or 10% if the counterparty is a credit institution).
3
Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of the
European Parliament and the Council with regard to liquidity coverage requirement for Credit Institutions Text with EEA
relevance (OJ L 11, 17.1.2015, p. 1–36).
6
(EU) 2023/1114
v. A general 25% of the reserve of assets concentration limit applies to all

exposures against the same counterparty/issuer/guarantor.
3.1 Identified risks to be assessed in the liquidity stress testing

3.1.1 Redemption risk
7. The risk of redemption is mainly linked to the liability side of the issuer of tokens and the proneness
to redemption requests by the token holders.
8. Issuers need to make sure that the amount of the reserve of assets is sufficient to meet any re-
demption request that can be made by token holders at any point in time. This should include cases
of stress scenarios where massive redemption requests could arise triggered by different drivers as
experience has evidenced, e.g. idiosyncratic events related to the issuer, to counterparties where
the reserve of assets are materialized, market wide systemic events in the crypto ecosystem and
financial system (reputational issues, solvency/liquidity issues, …) and token holders’ risk profile.
9. A massive redemption request might easily trigger fire sales or massive deposit withdrawals that
can ultimately negatively impact the capacity of the issuer, the deposit counterparty and the gen-
eral financial market and crypto ecosystem. If this is the case and a timely redemption is not met in
a sound manner further redemption requests across tokens and issuers can take place aggravating
the situation of the issuer, the financial system and crypto eco system and the general financial
markets.
3.1.2 Risk related to deposits with credit institutions
10.This risk is related to the part of the reserve of assets in the form of deposits with credit institutions.
11.The possibility of non-performance in deposits with credit institutions needs to be considered under
stress. Deposits with credit institutions are expected to be liquidity resources of the issuer for
prompt use in case of redemption request by the token holders at any time, including during stress
periods. The required amount of these assets by Regulation (EU) 2023/1114 is material in the case
of tokens referenced to official currencies, 30% of the assets referenced, or 60% if the token is
significant. Generally, also for other tokens, deposits with credit institutions are expected to reach
a minimum value to still ensure prompt redemption in funds if needed.
12.Deposits with credit institutions are a link of interconnectedness between the banking system and
the crypto ecosystem. Any potential distortion in the liquidation of the deposits may bring conse-
quences in both; reputational risks might arise in the banking system if the credit institution is not
able to repay the deposits in time and confidence in crypto assets could be damaged if redemption
cannot be met in time. All this can bring massive redemption requests in the crypto system with
subsequent deposits run-off if full performance is not guaranteed in the deposits with credit insti-
tutions.
7
(EU) 2023/1114
3.1.3 Market risk and volatility
13.This risk is mainly related to the part of the reserve of assets of token invested in securities or other
assets not replicating the assets referenced.
14.Market risk in the reserve of assets might put their market value (after derivative hedges) at risk of
not meeting the market value of the assets referenced, which represents the obligation of the issuer
against the token holders. This might be the case in tokens referenced to official currencies but also
to tokens with other assets referenced (e.g. commodities where the assets do not replicate the
obligations).
15.In addition, different volatility and lack of correlation between the reserve of assets and the assets
referenced could lead again to an insufficient amount of reserve of assets. This is the case where
changes in the market value of the reserve assets are different to the market value changes of the
assets referenced and this difference is not fully hedged with derivatives.
16.This risk might become exacerbated in times of stress and when the issuer might not timely meet
redemption requests from token holders that may in turn trigger such request from other token
holders and extend a liquidity distress situation to other issuers. The related shock transmission
channel to be considered is due to reputational reasons and lack of confidence in crypto assets, and
subsequently to the banking system if accompanied by massive deposit withdrawals and even fi-
nancial markets in general with potential fire sales.
3.1.4 De-pegging risk
17.This is the risk that the token referenced to an official currency may lose its par value. This is the
case where the market value of the token might become lower than the par value versus the official
currency. De-pegging risk refers to the differences between the market value of the token and the
market value of the asset referenced while market risk is referred to the market value of the reserve
of assets for the purposes of assessing its effectiveness to redeem the token holders by the market
value of the assets referenced.
18.A situation where the par value (redemption value) would be higher than the market value would
trigger massive redemption requests by the token holders. This could trigger fire sales, massive
withdrawals of deposits with the consequences already discussed where the reserve of assets might
ultimately not be sufficient to meet the redemption requests.
19.This risk can be triggered, for example, by idiosyncratic reasons like solvency or reputational related
ones. The liquidity stress testing should assess this risk and analyse if additional liquidity require-
ments are needed, like additional reserve of assets in order to mitigate potential consequences of
the loss of the par value.
8
(EU) 2023/1114
3.2 Liquidity stress testing methodology

20.These Guidelines identify the parameters that the liquidity stress testing needs to assess
to cover the relevant risks. Based on them, the tokens’ issuers should determine and cal-
ibrate the liquidity stress scenarios and stress factors/weights that should apply to the
reserve of assets, in the asset side, and to the assets referenced by the assets referenced
tokens, in the liability side.
21.The weighted market value (or weighted amount if not marketable, e.g. deposits) under
stress of the reserve of assets is compared with the weighted market value of the assets
referenced by the assets referenced tokens under stress. The outcome of this tests the
capacity of the reserve of assets to meet the redemption requests of the token holders
under stress that supervisors should consider for potential strengthening liquidity require-
ments in terms of additional reserve of assets or reinforced qualitative liquidity manage-
ment.
22.This methodology:
a. meets the expectations of the mandate that refers to the issuance of guidelines “with a view
to establishing the common reference parameters of the stress test scenarios … “. There is no
expectation that specific stress factors/weights should be established by the Guidelines neces-
sarily. The common reference parameters should be established to serve as harmonised
sources of information to be taken into account by the tokens’ issuers for the determination of
such stress factors.
b. captures the nature and substance of the liquidity stress testing which is for the purposes of
assessing the need of potential further liquidity requirements on an issuer-by-issuer basis. To
be noted that Regulation (EU) 2023/1114 requires the liquidity stress testing to be undertaken
for all the asset referenced tokens issued and crypto-services provided by the issuer in a holistic
and comprehensive manner.
c. is consistent with the fact that this is a new business activity and, therefore, there is lack of
historical observations under normal and stress conditions, mainly after the introduction of
Regulation (EU) 2023/1114, as to be able to estimate calibration factors to stress relevant as-
sets and liabilities in a harmonized manner via Guidelines.
d. provides harmonised stress testing elements as to the risks and parameters to be assessed and
the approach to follow to assess potential strengthening liquidity requirements.
9
4. Draft guidelines
10
EBA/GL/20XX/XX
DD Month YYYY
draft Guidelines
establishing the common reference

parameters of the stress test scenarios
for the liquidity stress tests referred in
Article 45(4) Regulation (EU) 2023/1114
11
1. Compliance and reporting

obligations
Status of these guidelines

1. This document contains guidelines issued pursuant to Article 16 of Regulation (EU) No
1093/2010 4 . In accordance with Article 16(3) of Regulation (EU) No 1093/2010, competent
authorities and issuers of assets referenced tokens5 must make every effort to comply with the
Guidelines.
2. Guidelines set the EBA view of appropriate supervisory practices within the European System of
Financial Supervision or of how Union law should be applied in a particular area. Competent
authorities as defined in Article 3(1), point (35) of Regulation (EU) 2023/1114 6 10 to whom
guidelines apply should comply by incorporating them into their practices as appropriate (e.g.
by amending their legal framework or their supervisory processes).
Reporting requirements
3. According to Article 16(3) of Regulation (EU) No 1093/2010, competent authorities must notify
the EBA as to whether they comply or intend to comply with these guidelines, or otherwise with
reasons for non-compliance, by [dd.mm.yyyy -– two months after publication of the translations
of the guidelines to all official languages]. In the absence of any notification by this deadline,
competent authorities will be considered by the EBA to be non-compliant. Notifications should
be sent by submitting the form available on the EBA website with the reference
‘EBA/GL/202x/xx’. Notifications should be submitted by persons with appropriate authority to
report compliance on behalf of their competent authorities. Any change in the status of
compliance must also be reported to EBA.
4. Notifications will be published on the EBA website, in line with Article 16(3).
4
Commission Decision 2009/78/EC, (OJ L 331, 15.12.2010, p.12).
5
This refers to issuers of significant assets referenced tokens by virtue of Article 45(4) of MiCAR. It also includes electronic
money (e-money) institutions issuing e-money tokens that are significant, following Article 58(1) of MiCAR, and can be
expanded to issuers of assets referenced tokens that are not significant as well as to e-money institutions issuing e-money
tokens that are not significant, if the competent authority of the home Member State requires it so following Article 35(4)
and Article 58(2) of MiCAR, respectively.
6
(OJ L 150, 9.6.2023).
12
2. Subject matter, scope and

addressees
Subject matter
5. These guidelines establish, in accordance with paragraph 8 of Article 45 of Regulation
(EU) 2023/1114, the common reference parameters of the stress test scenarios to be
included in the liquidity stress testing referred to in paragraph 4 of Article 45 that
Regulation.
Scope of application
6. These guidelines apply to issuers of significant asset-referenced tokens and electronic
money (e-money) institutions issuing e-money tokens (in accordance with Article
58(1), point a, of Regulation (EU) 2023/114) as defined in points 6 and 7, respectively,
of Article 3(1) of that Regulation, and non-significant when the competent authority
of the home Member State requires it so in accordance with Article 35(4) and Article
58(2) of the same Regulation (hereinafter, for the purpose of these guidelines, jointly
referred, as the “issuers of ARTs/EMTs").
Addressees
7. These guidelines are addressed to competent authorities as defined in Article 3(1)
point (35) of Regulation (EU) 2023/1114 to whom these guidelines apply.
8. These guidelines are also addressed to the issuers, as defined in point 10 of Article 3(1)
of Regulation (EU) 2023/1114, to whom these guidelines apply, of:
a) asset-referenced tokens as defined in Article 3(1), point 6 of that Regulation (is-

suers of asset-referenced tokens -ARTs-); and
b) and e-money institutions issuing e-money tokens defined in Article 3(1), point 7
of that Regulation (issuers of e-money tokens -EMTs-).
13
3. Implementation
Date of application
9. These guidelines apply from two months after the date of publication on the EBA’s
website of the guidelines in all EU official languages (date of issuance of the
guidelines).
Transitional provisions
10.[to be determined if needed]
14
4. Guidelines on the common reference

parameters of the stress test scenarios
in the liquidity stress testing
4.1 General provision

11.According with Article 45(4), 2nd subparagraph, Regulation (EU) 2023/1114, issuers of
ARTs/EMTs should assess the risks under section 4.2 and apply the methodology under
section 4.3, including the parameters of the stress test scenarios, considering all the
asset-referenced and e-money tokens offered and activities related to them.
4.2 Risks to be assessed

4.2.1 Redemption risk
12.Issuers of ARTs/EMTs should assess under stress the proneness to redemption

requests at any time.
13.For the purpose of paragraph 12, issuers of ARTs/EMTs should consider all the
following aspects: the profile of the token holders (including retail or wholesale); the
type of token (including if it is significant or not); the type of asset referenced (such as,
official currency or other); the characteristics of the issuer (such as, credit institution
or other); historical experience of redemption requests; and, the maturity profile of
the reserve of assets. Issuers may consider any other aspect they deemed relevant for
the assessment.
14.Issuers of ARTs/EMTs should assess the need to complement the percentages of the
reserve of assets with a residual maturity of up to one or five working days required
by the [RTS XXX/2024 further specifying the liquidity requirements of the reserve of
assets under Article 36(4) Regulation (EU) 2023/1114], by estimating a 99%
confidence interval relative to the average redeemed amount in the worst cases
observed of 1 and 5 days residual maturity in terms of gross outflows, based on their
particular historical observations.
4.2.2 Risk related to deposits with credit institutions
15.Issuers of ARTs/EMTs should assess under stress the possibility of failure to a prompt
access to the amount of the deposits held in credit institutions as part of the reserve
of assets.
15
16.For the purposes of paragraph 15, issuers of ARTs/EMTs should consider all of the
following aspects: i) the credit quality and the liquidity profile of the deposit
counterparty; ii) the concentration by counterparty and custodian; iii) the location of
the deposit; iv) the maturity of the deposit; v) the potential collateral (including
volume, type or quality) lying under the deposit; and, vi) any risk factor not covered by
the [RTS XXX/2024 further specifying the liquidity requirements of the reserve of
assets under Article 36(4) Regulation (EU) 2023/1114 ] they may consider relevant for
this risk.
4.2.3 Market risk and volatility
17.Issuers of ARTs/EMTs should assess under stress the need of additional liquidity
requirements to cover the market risk of the reserve of assets as well as its currency
denomination differences, volatility and correlation relative to the one of the assets
referenced, taking into account related hedging derivatives in place and in addition to
the mandatory overcollateralization as established in the [RTS XXXX/2024 further
specifying the liquidity requirements of the reserve of assets under Article 36(4)
Regulation (EU) 2023/1114].
18.Issuers of ARTs/EMTs should take into account the cases where the historical lookback
approach stipulated (in RTS XXXX/2024) on the mandatory overcollateralisation is
based on a 5 years period where no stress event has taken place. In these cases, for
example, longer than 5 years periods including stress events should be considered or
stress assumptions should be incorporated.
4.2.4 De-pegging risk
19.Issuers of ARTs/EMTs should assess the risk that the market value of the ARTs/EMTs
differ from the market value of the asset referenced and whether additional liquidity
requirements are necessary to mitigate that difference.
4.3 Methodology
4.3.1 The liquidity stress testing
20.Issuers of ARTs/EMTs should compare the total weighted amount of the reserve of
assets with respect to the total weighted amount of the assets referenced by the
ARTs/EMTs, under stress.
21.For the purposes of paragraph 20, issuers of ARTs/EMTs should calculate the total
weighted amount of the reserve of assets as the result of multiplying the market value
of each asset in the reserve of assets by the relevant stress factor (weight). In the case
of assets that are not marketable (such as cash or deposits in credit institutions),
issuers of ARTs/EMTs should take the amount multiplied by the relevant stress factor.
16
22.That total weighted amount of the assets referenced by the tokens is the result of
multiplying the market value of the assets referenced by the relevant stress factor. In
the case of ARTs/EMTs referenced to official currencies their monetary value should
be taken as weighted amount of the assets referenced.
23.A shortfall of the reserve of assets in the liquidity stress testing arises where the total
weighted amount of the reserve of assets is lower than the weighted amount of the
assets referenced by the tokens, under stress.
Explanatory box:
Total weighted reserve assets (under stress)
- Deposits with credit institutions: amount x stress factor (weight) to deposits

- Commodities (gold, oil, …): market value x stress factor (weight) to commodities
- Sovereign bonds: market value x stress factor (weight) to sovereign bonds
- Covered bonds: market value x stress factor (weight) to covered bonds
- Other financial instruments as highly liquid financial instruments: market value x stress
factor (weight) to other financial instrument
Total weighted assets referenced by the tokens (under stress) - liabilities
- Asset referenced other than official currencies: market value of the asset referenced x
stress factor (weight) to asset referenced
- Assets referenced to official currencies: monetary value of the assets referenced
Shortfall under liquidity stress testing = total weighted reserve assets – total weighted assets
referenced by the tokens
4.3.2 Identification of the common referenced parameters of the stress test

scenarios
24.Issuers of ARTs/EMTs should calibrate and determine the relevant stress factors for
each asset of the reserve of assets and for the assets referenced by the ARTs/EMTs
under various stress scenarios and time horizons, including 1 day, 5 days, 30 days and
1 year.
25.Issuers of ARTs/EMTs should base the calibration of the stress factors on historical
observations (their own observations plus observations from market events) and
expert judgment. Issuers of ARTs/EMTs should have a historical documentation of data
series of observations and detailed rationale for any expert judgment proving the
appropriateness of the calibration.
17
26.The stress factor for a specific asset class should be constructed considering the
combination of risk factors and parameters relevant for the asset class under different
stress events/scenarios from an idiosyncratic and market wide perspective. The
severity of the shocks should be determined by the severity of the given stress scenario
(including the time horizon). Therefore, different stress factors for the same asset class
may be derived for each scenario.
27.The stress factor to be applied to each asset of the reserve of assets should be lower
than 100%. The stress factor to be applied to the assets referenced should be higher
than 100% if the tokens are not referenced to official currencies.
28.In the determination of the stress factors issuers of ARTs/EMTs should assess all the
following parameters and take into account the risks envisaged in section 4.2 of these
Guidelines. Issuers of ARTs/EMTs may also consider other relevant parameters and
risks not already considered and which are not inconsistent with those in these
guidelines.
a) Parameters related to the calibration of the stress factors of the reserve of assets
29.In the determination of the stress factors to the following assets in the reserve of
assets, issuers ARTs/EMTs should take into account under stress all the following
parameters:
a. Deposits with credit institutions:
i. the credit quality of the deposit taking institution and expectations of non-
performance;
ii. the credit and liquidity quality of the underlying collateral if the deposit is
collateralised;
iii. the concentration by the deposit taking institution;
iv. the tenor and early withdrawal options; and
v. the roll-over risk stemming from securities financing transactions,

especially repos, where cash is received against non- liquid assets7.
b. Commodities:
i. the extent to which the reserve assets replicate the assets referenced by
the tokens; and
7
Liquid assets to be understood as those defined in Article 3 (1) and (2) as ‘level 1 assets’ or ‘level 2 assets’, respectively,
of Commission Delegated Regulation (EU) 2015/61 of 10 October 2014, to supplement Regulation (EU) No 575/2013 of
the European Parliament and the Council with regard to liquidity coverage requirement for Credit Institutions (OJ L 011
17.1.2015, p.1).
18
ii. the potential delivery risk and costs associated if the redemption is in
physical.
c. LCR level 1 liquid assets subject to 0% haircuts (as referred to in Article 1 of the
RTS XXX/2024 further specifying the liquidity requirements of the reserve of
assets under Article 38(5) Regulation (EU) 2023/1114):
i. the weighted average residual maturity/duration to take into account their

potential sensitivity to interest rate risk and related volatility;
ii. the country risk premium to take into account their related volatility;
iii. the concentration by issuer;
iv. the location of the security (custodian) to take into account any potential
challenge for a prompt transfer; and
v. the evolution of the market value of the specific security, to assess their
volatility and correlation with respect to the assets referenced.
d. LCR level 1 covered bonds (as referred to in Article 1 of the RTS XXX/2024 further
specifying the liquidity requirements of the reserve of assets under Article 38(5)
Regulation (EU) 2023/1114):
i. the required LCR haircuts;
ii. the weighted average residual maturity/duration to take into account their
potential sensitivity to interest rate risk and related volatility,
iii. their percentage of the reserve of assets,
iv. the concentration by issuer,
v. the location of the security (custodian) to take into account any potential
challenge for a prompt transfer,
vi. the evolution of the market value of the specific security, to assess their
e. other highly liquid financial instruments (as referred to in Article 1 of the RTS
XXX/2024 further specifying the liquidity requirements of the reserve of assets
under Article 38(5) Regulation (EU) 2023/1114):
i. the required LCR haircuts;
ii. the weighted average residual maturity/duration to take into account their
potential sensitivity to interest rate risk and related volatility;
19
iii. their percentage of the reserve of assets;
iv. the concentration by issuer;
v. the location of the security (custodian) to take into account any potential
challenge for a prompt transfer; and
vi. the evolution of the market value of the specific security, to assess their
b) Parameters related to the calibration of the stress factors of the assets referenced
30.In the determination of the stress factors to the assets referenced by the tokens,
issuers of ARTs/EMTs should take into account under stress all the following
parameters:
i. volatility and distributional indicators of the market value of the reserve of

assets (such as mean, quartiles and distribution of the market value of the
reserve of assets);
ii. volatility and distributional indicators with respect to the assets referenced
(such as mean, quartiles and distribution of the market value of the assets
referenced);
iii. idiosyncratic stress factors (such as liquidity, solvency soundness of the

issuer);
iv. market wide stress factors (such as stress factors in the financial system or
the crypto eco-system, number and magnitude of deviations between the
token price and the market value of the asset referenced by the token).
20

1. Article 16(2) of the EBA Regulation (Regulation (EU) No 1093/2010 of the European Parliament
and of the Council) provides that, where appropriate, the EBA should analyse ‘the related
potential costs and benefits’ of Guidelines issued by the EBA. Such analysis shall be
proportionate in relation to the scope, nature and impact of the Guidelines. The following
section provides an impact assessment of the Guidelines. It includes an overview of the findings
regarding the problems to be dealt with, options available to tackle the problems, and cost-
benefit analysis compared with the baseline scenario.
2. The following sections focus on the description of the elements that guided the choice
of the policy options to be followed for the definition of the risk factors to be covered
in the stress scenarios and for the calibration of the stress factors/weights. It is
noteworthy that this is a qualitative assessment describing the pros and cons that
informed the decision-making process.
5.1.1 Risk factors policy options
3. The EBA has assessed two policy options:
- Policy option A: The GL identify the risks that need to be covered in the Liquidity Stress
Testing.
- Policy option B: The GL do not identify the risks that need to be covered in the Liquidity
Stress Testing and the issuer would have full freedom and no constraints in the determina-
tion of the risks to cover.
Advantages Disadvantages
Enhanced harmonization across Possibility that the specific risk profile

the EU; of the issuer is not fully reflected in a
general approach.
General approach, still ensuring
Policy option A issuers an adequate degree of
freedom when defining their
liquidity risk management
practices, and allowing to reflect
their specific characteristics;
21
Possibility to introduce
proportionality rules to account
for the scale, size and complexity
of the token and the issuer;
Comprehensive approach aimed

at ensuring that systemic threads
are properly addressed;
High comparability of results.
Issuer-specific approach, ensuring A not adequate risk management

that the specific characteristics of structure may introduce constraints
the issuers are fully reflected in on the ability of the issuer to identify
the liquidity risk management risks to be tackled;
framework;
Great degree of variability across
The issuer can leverage its issuers, with consequent lower ability
knowledge to identify risks that to tackle systemic risks;
need to be tackled given the token
and the holders characteristics Low comparability of results across
(i.e., idiosyncratic risks); issuers;
Policy option B
A virtuous risk management This approach would require non-

structure may create examples of negligible operational costs for
good practices to be shared with issuers, as excessive communication
the industry. between institutions, CAs and EBA
would be needed to assess that the
specific framework established by
issuers is appropriate to address their
risk (guidelines on ST).
4. The EBA opted for policy option A to ensure a minimum harmonization of the risks that
should be considered in the liquidity stress testing and that ultimately define the basis
for the harmonized identification mandated in Article 45(8) MiCAR of the parameters
of the stress scenarios. Still the specificities by issuer and token can be considered in
the analysis of the specific risks.
22
5.1.2 Calibration approach
5. The EBA has assessed two policy options:

- Policy option 1: the specific calibration of the stress factors/weights to be provided in the
GL
- Policy option 2: the calibration of the stress factors/weights to be determined by the issuer.
Harmonised practice across the Lack of historical observations under

EU; stress conditions to calibrate stress
factors for all issuers and tokens.
Enhanced results comparability. Only in the future this could be a
potential option based on
Lower operational burden for
supervisory experience.
issuers.
The specificities of the issuers are not
considered and idiosyncratic risk
Policy option 1
drivers are disregarded which is key
in the determination of liquidity
requirements based on the outcome
of the liquidity stress testing as
envisaged in Article 45(4) of MiCAR;
Update of the calibration of the stress

factors subject to regulatory changes
calendars.
Enhanced risk sensitivity, in that

Black box risks (i.e., not transparent
weights calibrated leveraging estimation techniques), however the
internally developed procedures proposed RTS to specify the
can prove to be more sensitive to
minimum content of the liquidity
the idiosyncratic drivers of risk
management policy and procedures
(BCBS on IRB). under Article 45(7)(b) requires that
Policy option 2 all the information related to the
An issuer-by-issuer analysis is calibration of the stress factors will
consistent with the purposes of be included therein;
the liquidity stress testing in
MiCAR, i.e. to assess potential Lack of historical data needed to
strengthening of the liquidity perform the calibration;
requirements by the supervisor
23
based on the outcome of the
Risk that, given the novelty of the
liquidity stress testing.
topic, the issuers will move in
significantly different directions,
A virtuous risk management
lowering the compatibility of results.
structure may create examples of
good practices to be adopted by
the rest of the industry;
The identification of the risk factor

and parameters of the stress
scenarios ensure a minimum
harmonisation for the calibration
of the stress factors/weights.
Ongoing update of the calibration

of the stress factors.
6. The EBA opted for policy option 2. The EBA prevails the implementation of the
idiosyncratic risk drivers in the calibration of the stress factors/weights to ensure
consistency with the expectation in Article 45(4) MiCAR for supervisor to strengthen
liquidity requirements if needed for issuers based on the outcome of the liquidity
stress testing that need to take into account their own specificities.
24
Question 1. Do respondents have any comment with respect to the proposed non-re-
strictive list of parameters of the stress test scenarios that need to be con-
sidered for the calibration of the stress factors?
Question 2. Do respondents have any comment about the risks identified that need to
be covered by the parameters of the stress test scenarios? Do respondents
think that any other risk should be included?
Question 3. Do respondents find operational challenges in the implementation of the

guidelines?
Question 4. Do respondents find any piece of the guidelines confusing or difficult to un-
derstand?
25
EBA/CP/2023/26
08 NOVEMBER 2023
Consultation Paper

to specify the minimum contents of the liquidity management policy
and procedures under Article 45(7)(b) of Regulation (EU) 2023/1114
CONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS TO SPECIFY THE MINIMUM
CONTENTS OF THE LIQUIDITY MANAGEMENT POLICY AND PROCEDURES UNDER ARTICLE 45(7)(B) OF
Contents
5.1 Draft cost-benefit analysis / impact assessment 16
5.2 Overview of questions for consultation 20
2
CONTENT OF THE LIQUIDITY MANAGEMENT POLICY AND PROCEDURES UNDER ARTICLE 45(7)(B) OF

To submit your comments, click on the “send your comments” button on the consultation page
European Ombudsman.
Data protection
website.
3
Article 45(3) of MiCAR requires issuers of significant asset-referenced tokens to establish, maintain
and implement a liquidity management policy and procedures. Based on that policy and procedures
issuers have to assess and monitor their liquidity needs to meet any redemption of the asset-
referenced tokens that can be requested at any time by their holders. The ultimate target of the
liquidity management policy and procedures is to ensure that the reserve assets have a resilient
liquidity profile that enables issuers of significant asset-referenced tokens to continue operating
normally, including under scenarios of liquidity stress.
The requirement of that liquidity management policy and those procedures applies as well to
electronic money (e-money) institutions issuing e-money tokens that are significant by virtue of
Article 58(1) MiCAR and can be expanded to issuers of asset-referenced tokens that are not
significant and to e-money institutions issuing e-money tokens that are not significant if the
competent authority of the home Member State requires it so following Article 35(4) and Article
58(2) of MiCAR respectively.
Article 45(7)(b) of MICAR requires that the reserve of assets for significant asset-referenced tokens
consists of at least 60% of deposits referenced in each official currency.
With these draft Regulatory Technical Standards (RTS) the EBA is complying with its mandate in
Article 45(7)(b) of MiCAR to specify, in close cooperation with ESMA, the cited minimum content of
the liquidity management policy and procedures and related liquidity requirements.
Next steps
The draft regulatory technical standards will be submitted to the Commission for endorsement
following which they will be subject to scrutiny by the European Parliament and the Council before
being published in the Official Journal of the European Union.
4

1. Issuers of significant assets referenced tokens (ARTs) and e-money institutions issuing
significant e-money tokens (EMTs) (as well as issuers of ARTs that are not significant and e-
money institutions issuing EMTs that are not significant, both if required by the relevant
competent authority) 1 are required to establish, maintain and implement a liquidity
management policy and procedures. These policy and procedures shall ensure that the
reserve assets have a resilient liquidity profile so that issuers can operate normally, including
during liquidity stress.
2. Accordingly, and as per Article 45(7)(b) of (EU) Regulation 1114/2023 on markets in crypto-
assets (MiCAR), the EBA, in close cooperation with ESMA, is mandated to develop draft
regulatory technical standards (RTS) specifying the minimum contents of the above liquidity
policy and procedures and related liquidity requirements.
3. Moreover, the EBA is also mandated under that provision to specify the minimum banking
deposit amount in the reserve of assets for issuers of significant EMTs and ARTs that are
referenced to official currencies. This part of the mandate is being addressed by the EBA in
the draft RTS under 36(4)(d) of MiCAR, for consistency reasons, together with the
specification of the minimum amount of deposits in credit institutions where it comes to
EMTs and ARTs referenced to official currencies that are not significant.
4. For the development of these draft RTS, the EBA builds on the December 2022 Basel
standards on the prudential treatment of crypto-assets exposures 2 , taking into account
Article 86 of the CRD on liquidity risk and the EBA Guidelines on ILAAP 3, adapted to the
crypto-activities of tokens issuers.
5. The consultation of these draft RTS for the specification of the minimum contents of the
liquidity management policy and procedures under Article 45(7)(b) MiCAR is being
undertaken in parallel with two other consultations on liquidity related aspects of issuers of
tokens, i.e. the draft RTS to specify highly liquid financial instruments under Article 38(5)
MiCAR and the draft RTS to further specify liquidity requirements envisaged in Article 36(4)
MiCAR.
1
As envisaged in paragraph 3 of Article 45 (on significant ARTs) in conjunction with paragraph 1 of Article 58 (on
significant EMTs issued by e-money institutions), paragraph 4 of Article 35 (on non-significant ARTs) and paragraph 2 of
Article 58 (on non-significant EMTs issued by e-money institutions).
2
Prudential treatment of cryptoasset exposures (bis.org)
3
EBA/GL/2016/10
5
3.1 Liquidity management related risks of issuers of ARTs and e-

money institutions issuing EMTs
6. To ensure that the issuers of ARTs and e-money institutions issuing EMTs can cover their
liabilities against holders of their issued tokens, issuers should constitute and maintain a
reserve of assets matching the risks reflected within the said liabilities.
7. Issuers should ensure the prudent management of the reserve of assets by mainly ensuring
that the value of the reserve is at least equal to the corresponding redemption value of
tokens in circulation and that changes in the reserve are adequately managed to avoid
adverse impacts on the market of the reserve assets. In this regard the composition and
management of the reserve assets, particularly the degree to which they could be liquidated
rapidly at or close to prevailing market prices, is of key importance. This is to avoid ending up
in situations where large-scale redemptions result in “fire sales” of reserve assets that could
reduce the “stable” value of the token or in situations where part of the reserve assets is
trapped in other institutions.
8. The loss of value of the reserve of assets, or the mere expectation of it, could impair holders’
confidence in the resilience of the token as a payment mechanism, trigger significant
redemption requests with subsequent negative impact on traditional financial institutions
and financial markets in which such assets were traded. Also, significant changes in the
composition of the reserve assets, even in the absence of large-scale redemption, might
trigger spill over effects to the wider financial system. The ability to sell reserve assets in large
volume at (or close to) prevailing market prices depends on the duration, quality, liquidity,
market depth and concentration of the reserve assets. The degree of transparency as to the
nature and liquidity of these reserve assets might also affect confidence in the token.
9. The holders of the tokens have a permanent right of redemption meaning that the issuer has
the obligation to redeem the tokens at any time and upon request by holders. The issuer
should fulfil this redemption request either by:
- paying an amount in funds, other than electronic money, equivalent to the

market value of the assets referenced by the tokens; or
- delivering the assets referenced by the tokens (in specie).
10.For the reasons listed above, these liquidity management policy and procedures aim to
ensure that the reserve of assets have a resilient liquidity profile to ultimately meet any
request for redemption by holders of asset referenced tokens at any time, including during
liquidity stress scenarios, without distorting the continuity of operations of the issuer.
6
3.2 Draft regulatory technical standards specifying the minimum

contents and liquidity requirements of the liquidity management
policy and procedures
11.Article 45(3) of MiCAR envisages that issuers of significant assets referenced tokens need to
have in place a liquidity management policy and procedures aiming to ensure that the
reserve of assets have a resilient liquidity profile to ultimately meet any request for
redemption by holders or assets referenced tokens at any time, including during liquidity
stress scenarios, without distorting the normal continuity of operations of the issuer.
12.For these reasons, the liquidity management policy and procedures need to include and keep
updated at least the following items to ensure that issuers have the minimum resources in
place to assess their liquidity needs in view of potential redemptions requests by token
holders:
- The issuer’s liquidity risk management framework, with the identification of the
processes in place for identifying, measuring, managing and reporting liquidity
risk. It should include the risk appetite limit, the drivers for liquidity risk selected
by the issuer for monitoring its liquidity position, needs and availabilities, with
particular attention to meet ultimately any potential redemption request by
holders.
- The issuer’s strategy to manage the reserve of assets in an effective and prudent
manner and with the ultimate target to ensure that the risks associated to the
reserve assets and the assets referenced by the ARTs are covered. This strategy
includes the determination of the minimum size of the reserve of assets, that
depends on the number of tokens and the overcollateralisation, the criteria to
determine their market value, concentration limits, gap analysis for relevant
time horizons and approaches to ensure currencies matching and details on the
branches and legal entities in the scope of the issuer, among other aspects. This
strategy should be consistent with the risk appetite of the issuer as set by the
management body. The strategy should consider the necessary correlation
between the assets referenced and the ARTs’ reserve of assets.
- The issuer’s liquidity contingency plan including a description of the strategies

for addressing liquidity shortfalls in emergency situations and of the lines of
responsibilities for its monitoring and execution, a description of the tools in
place to monitor market conditions to determine in a timely manner whether
execution of measures is warranted. It should include liquidity risk mitigation
tools, internal limits for early reaction to be able to withstand a range of
different stress events, idiosyncratic, market-wide, and combined ones, and
identified funding alternatives.
7
- Description of the custody policy of the reserve assets that aims to ensure
prompt access to them as required by MiCAR. Indeed, concentration by
custodian needs to be avoided following MiCAR. Therefore, issuers should have
in place adequate policies that ensure a prudent diversification of custodians.
- Description of the liquidity stress testing framework following Article 45(4)

MiCAR, in particular the risks identified for this exercise and parameters
considered to cover them with detailed information of their calibration. The
liquidity management policy should reflect the outcome of the liquidity stress
testing with a description of potential measures taken to strengthen the
liquidity arrangements. The liquidity stress testing shall be made on a monthly
basis at least as established in the draft RTS under Article 35(6) MiCAR under
consultation to further specify, among others, the minimum requirements for
the design of stress testing programmes including the frequency of the different
stress testing exercises.
13.The liquidity management policy and procedures of the issuer need to be separate for each
ARTs consistently with the required legal and operational segregation of their corresponding
reserve of assets. Different assets referenced and correlation with the relevant token’s
reserve of assets might need differentiated risk limits, management tools and strategies.
14.The liquidity management policy and procedures of the issuer related to its crypto-assets
activities should be separate and specific (from a formal and content related perspective)
from the liquidity policy of its other activities. For example, if the issuer is a credit institution,
the liquidity management policy and procedures related to its activities as issuer of ART and
EMT should be separate from the one on its banking activities. This is consistent with the
required legal and operational segregation of the reserve of assets from the issuer’s estate.
Other relevant aspects are segregation of duties, independence of risk control or
independent internal reporting. However, this should not be interpreted as a
recommendation not to conduct in a holistic manner the management of an entity.
15.The EBA would like to highlight that the provisions envisaged in these RTS should be read
together with the provisions related to liquidity as envisaged in the upcoming EBA guidelines
on liquidity stress testing envisaged in Article 45(4), applicable to issuers of tokens that are
significant and to those that are not significant if required by the competent authorities, the
EBA guidelines on the minimum content of the governance arrangements, for issuers or
ARTs, under Article 34(13), in particular as regards internal control mechanisms established
in paragraph 10 and the EBA guidelines on recovery plans under Article 46(6) for issuers of
ARTs.
8
EN 9
EN
of XXX

Council with regard to regulatory technical standards for specifying the minimum
contents of the liquidity management policy and procedures
of 31 May 2023 on markets in crypto-assets, and amending Regulations (EU) No 1093/2010
and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/19374, and in particular
Article 45(7), fourth subparagraph, thereof,
Whereas:
(1) The minimum contents and procedures for identifying, measuring and managing
liquidity risk of issuers of crypto-assets should be set out with the ultimate target to
ensure that the value of their reserves of assets can meet any redemption request by
token holders under normal or stress scenarios ensuring the normal continuity of the
business. Issuers of crypto-assets should pay particular attention to the volatility of
assets referenced relative to the reserve of assets and perform a subsequent analysis of
the necessary overcollateralisation. Issuers of crypto-assets should avoid any
concentration by custodian to mitigate any counterparty risk.
(2) Issuers of crypto-assets should establish a contingency plan with early warning signals
and mitigation tools. In particular, issuers of crypto-assets should monitor as an early
warning signal the volatility of assets referenced relative to the reserve of assets and
the evolution of any gap between the market value of the tokens and the market value
of the assets referenced. This indicator is considered specially relevant for spotting
potential massive redemptions requests, particularly in view of any potential
underestimation of the market value of tokens in the market. Given that an
overestimation of the market value of a token in the market might likely create the
incentive to sell it, issuers should pay attention to transaction volumes and prices in
order to be ready to react to any adverse evolution.
(3) As a reserve of assets for one token is segregated from a reserve of assets from other
tokens, the liquidity management policies related to each of them sould be segregated
as well.
(4) A detailed description of the risks covered, the parameters identified and their
calibration for the purposes of the liquidity stress testing established in Article 45(4)
4
OJ L 150, 9.6.2023, p. 40.
EN 10
EN
of Regulation (EU) 2023/1114, as well as the outcome of the exercise, should be

envisaged in the liquidity management policy. The review of this information, that
should be updated for each liquidity stress testing exercise, is expected to allow
supervisors to decide on appropriate measures to strengthen the issuers’ liquidity
requirements if necessary.
(5) The minimum amount of bank deposits in the reserve assets for significant asset-
referenced tokens and e-money tokens should be provided, at the level provided by
Regulation (EU) 2023/1114, that is 60% of the amount referenced in each official
currency. Such a requirement is expected to keep a significant amount of the reserve
of assets as capable to be liquidated in the market with multiple counterparties, and to
ensure that the potential risk of reciprocal contagion effects due to the
interconnectedness with the banking system is mitigated.
(6) Considering that requirements set out in Article 45, points (1) to (4) of Regulation
(EU) 2023/1114 also apply to issuers of e-money tokens issued by electronic money
institutions (either significant or, where decided, non-significant), as per Article 58(1),
point (a), and (2) of that Regulation, this Regulation should also apply to issuers of e-
money tokens issued by electronic money institutions that are subject to or required to
comply with those requirements.
(7) This Regulation is relevant for issuers of e-money tokens that are subject to or required
to comply with requirements referred to in Articles 45 of Regulation (EU) 2023/1114.
(9) The European Banking Authority, in close cooperation with the European Supervisory
Authority (ESMA) established by Regulation (EU) No 1095/2010 of the European
Parliament and of the Council5, has conducted open public consultations on the draft
regulatory technical standards on which this Regulation is based, analysed the potential
related costs and benefits and requested the advice of the Banking Stakeholder Group
established in accordance with Article 37 of Regulation (EU) No 1093/2010 of the
European Parliament and of the Council,6
5 Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a
European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and
repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84).
6Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a
Commission Decision 2009/78/EC (OJ L 331, 15.12.2020, p. 12).
EN 11
EN
Article 1
Procedures for identifying, measuring and managing liquidity risk
1. Issuers of asset-referenced tokens and/or e-money institutions issuing e-money

tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall have
robust strategies, policies, processes and systems for the identification, measurement,
management, monitoring and internal reporting of liquidity risk over an appropriate
set of time horizons, so as to ensure that they maintain adequate levels of their reserve
of assets. Those strategies, policies, processes and systems shall ensure the issuer’s
normal continuity of operations by meeting any redemption request by holders of
asset-referenced tokens and e-money tokens.
2. The strategies, policies, processes and systems referred to in paragraph 1 shall be
proportionate to the complexity, risk profile, scope of operation of the issuers of
asset-referenced tokens and/or, where applicable, e-money institutions issuing e-
money tokens, and be approved by the issuers’ management body, which shall set
risk tolerance levels to each asset-referenced token or e-money token. The strategies,
policies, processes and systems referred to in paragraph 1 shall reflect the issuers’
current and expected liquidity risks which shall be monitored on an ongoing basis.
This shall include the identification of deposits with credit institutions or of any other
asset received in the issuance of the tokens and kept in the reserve of assets, and of
the highly liquid financial instruments in which the reserve of assets can be invested
in, the criteria to determine their market value, the assessment of concentration risk,
creditworthiness and liquidity soundness, as well as their limits, time horizons,
currencies’ consistency and the techniques for ensuring the stability of the reserve of
assets’ value with respect to the referenced asset(s).
tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall establish
appropriate arrangements for a sound management of the intra-day liquidity risk.
This includes the identification of the expected intra-day liquidity needs and
resources and setting up process and procedures coherent with the profile of the
issuer, the token and the contingent and expected market situation.
tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall monitor
their reserve assets to ensure that they are available to cover the value of assets
referenced by the tokens at all times, in particular during emergency situations, and
assess the appropriateness of overcollateralisation, especially where the assets
referenced by the tokens are highly volatile or do not form part of the reserve of
assets. The custody service provider, custody policies and related contractual
arrangements shall be monitored at any time.
tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall have in
place specific measures and limits to avoid concentration of the reserve of assets by
custodian.
EN 12
EN
6. Issuers of asset-referenced tokens not referencing official currencies shall establish

adequate processes and procedures to address risks arising from cases in which the
reserve of assets are not composed by the assets referenced. In particular, the issuers
shall have sound and comprehensive arrangements for managing risks arising from
the use of derivative instruments and/or instruments providing a synthetic replica of
the referenced assets.
Article 2
Contingency policy and mitigation tools

tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall develop
and calibrate early warning signals, including maximum deviations between the
market value of the reserve of assets and the market value of the assets referenced by
the tokens and also between the market value of the tokens and the market value of
the assets referenced by the tokens.
tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall have in
place and regularly review different liquidity risk mitigation tools, including
adequate access to diversified funding sources, to react to any early warning signal,
embracing normal and stress scenarios.
tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall adjust
their strategies, early warning signals, internal policies and limits on liquidity risk
and develop effective contingency plans, taking into account the outcome of the
stress testing.
4. On the set-up of the liquidity contingency planning, issuers of asset-referenced
tokens and/or e-money institutions issuing e-money tokens that have to apply Article
45(3) of Regulation (EU) 2023/1114 shall maintain the following policy
documentation:
(a) description of the lines of responsibilities for designing, approving,
monitoring and executing the liquidity contingency plan as well as to
maintain it up to date;
(b) description of the strategies for addressing liquidity shortfalls in emergency
situations;
(c) description of a tool, with internal limits, to monitor market conditions that
allow issuers to determine, in a timely manner, whether escalation or
execution of measures or both are warranted.
EN 13
EN
Article 3
Segregation of the liquidity management policy and procedures

tokens that have to apply Article 45(3) of Regulation (EU) 2023/1114 shall have
separate and adapted information, in content and form, on the procedures for
identifying, measuring, managing and reporting liquidity risk, contingency policies
and mitigation tools, as envisaged in Article 1, 2 and 3 of this Regulation, by each
asset-referenced token and e-money token they issue. Those separate policies shall
detail differentiated risk limits, management tools and strategies, taking into account
the different asset referenced and their correlation with the relevant segregated
reserve of assets.
2. The liquidity management policy and procedures envisaged in this Regulation shall
be separate, in content and form, from the liquidity policy related to other activities
of the issuer other than those related to its issuing of crypto-assets.
Article 4
Liquidity stress testing

tokens that have to apply Article 45(4) of Regulation (EU) 2023/1114 shall include
in the liquidity management policy the process and procedures of the liquidity stress
testing and an updated description of the following aspects:
(a) the risks covered in the liquidity stress testing;
(b) the parameters considered and their calibration under stress, as well as the
stress scenarios and time horizons used in the liquidity stress testing;
(c) the historical data and assumptions, including any expert judgments,
considered by the issuer in the calibration of the parameters mentioned in
point (b);
(d) the outcome of the liquidity stress testing and remedies taken.
2. The stress testing exercise shall include a reverse stress test element to assess the
limit of resilience of the liquidity profile of each reserve of assets.
EN 14
EN
Article 5
Entry into force
Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
EN 15
EN

1. Following Article 10 of Regulation (EU) No 1093/2010 (EBA Regulation), the EBA shall analyse
the potential costs and benefits of draft Regulatory technical standards (RTS). RTS developed
by the EBA shall therefore be accompanied by an Impact Assessment (IA) that analyses ‘the
potential related costs and benefits’.
2. This analysis presents the IA of the main policy options included in this Consultation Paper
on the draft RTS on the specification of the minimum content of the liquidity management
policy and procedures, as well as regarding the potential specification of a higher minimum
amount of deposits with credit institutions to be held by issuers of significant ARTs, which
the EBA is mandated to develop under Article 45(7)(b) of Regulation (EU) 1114/2023 (MiCAR)
on markets in crypto-assets.
5.1.1 Specification of the minimum content of the liquidity management policy

and procedures
3. Article 45(3) MiCAR refers to the liquidity management policy and procedures that issuers of
significant ARTs need to have in place to ensure that the reserve assets have a resilient
liquidity profile that enables issuers of significant ARTs to continue operating normally,
including under scenarios of liquidity -stress.
4. The draft RTS generally envisages a minimum content that seeks to contribute to the
identification, measurement, mitigation and evaluation of the liquidity risk in the issuers of
ARTs. These minimum strategies that have to be in place contribute to an adequate
assessment and monitoring of the liquidity risk and are particularly targeting to ensure that
the composition of the reserve of assets of issuers of ARTs are sufficient to cover any
redemption request of holders of token in circulation (tokens issued).
5. The EBA initially got inspiration from the content of the liquidity management policies in
banks by observing the related expectations under the CRD and the EBA GL on ILAAP. The
EBA finally adapted these expectations to the crypto activities of issuers of tokens with the
main aim to ensure an appropriate composition of the reserve of assets, across the wide set
of eligible highly liquid financial instruments, and sufficient volume of it, with potential
overcollateralisation (voluntary or mandatory), to ultimately contribute to a more resilient
reserve of assets to meet any redemption request by token holders at any time, including in
times of stress.
16
6. The EBA also takes into account other specific mandates related to the details of the general
internal control framework and the liquidity stress testing exercise, via specific guidelines,
that are also related to liquidity risk. These draft RTS seek to avoid any overlapping with these
topics for which the legislator envisages specific separate mandates and regulatory products.
7. The inclusion of the basis risk test has been assessed under different alternatives.
a. Basis risk test
8. The basis risk test was proposed by the BCBS in previous consultative versions (link) to the
final standards on the prudential treatment of cryptoasset exposures published in December
2022 (link).
9. The following description show the main features of the basis risk test as assessed in those
consultative versions:
BCBS Second Consultation on the prudential treatment of cryptoasset exposures
Basis risk test. The objective of the basis risk test is to ensure that the holder of a cryptoasset
can sell it in the market for an amount that closely tracks the peg value. This element envisages
two thresholds, 10bps and 20 bps, to reduce cliff effects. Specifically:
(1) If the peg-to-market value difference does not exceed 10bp more than 3 times over the prior
12 months, the cryptoasset has “fully passed” the basis risk test.
(2) If the peg-to-market value difference exceeds 20bp more than 10 times over the prior 12
months, the cryptoasset has “failed” the basis risk test.
(3) If the cryptoasset has neither “fully passed” nor “failed” the basis risk test, it is considered to
have “narrowly passed” the basis risk test. Cryptoassets that meet all the classification
conditions for inclusion in Group 1b, but only narrowly pass the basis risk test, will be subject to
an add-on to risk weighted assets.
10.As stated in the final standards “The basis risk test, which is a quantitative test based on the
market value of the cryptoasset, aims to ensure that the holder of a cryptoasset can sell it in
the market for an amount that closely tracks the peg value.” The Committee decided not to
implement the basis risk test in the final standards. The Committee agreed to further study
whether there are statistical tests that can reliably identify low-risk stablecoins, and if such a
test is identified, will consider it as an additional requirement for inclusion in Group 1b.
11.The EBA considered the possibility to introduce some safeguards with respect to the
concerns addressed by the basis risk test without introducing the requirement itself taking
into account that MICAR does not envisage the basis risk test as a minimum requirement to
be passed. Two policy options were assessed in this regard:
17
- Policy option 1: to envisage as a minimum specific early warning signal in the

contingency policy an indicator measuring the difference between the market
value of the token and the market value of the assets referenced. The
calibration of the internal limit for such deviation is done by the issuer.
- Policy option 2: to not include any minimum specific early warning signal as
such.
The consequence of large

deviations between the market
Lack of identification in the RTS with
value of the token and the asset
regards to which actions might be
referenced is that token holders
taken in case that the deviations
might feel motivated to request
might exceed the internal limits
massive redemption of tokens, in
calibrated by issuers to avoid the
case of a negative deviation where
risk of massive redemption
the token is underestimated in the
requests or sales.
market, or massive sales of tokens if
the deviation is positive where the However, it might be argued that it
token is overestimated in the is up to the issuer to determine the
market. actions to be taken in that case. The
market value of the token might be
Under both situations an undesired
defined by idiosyncratic and market
impact on the stability of the issuer
Policy option 1 related factors. The issuer could
and of the markets could arise.
take measures to control
idiosyncratic drivers, for example
With this indicator issuers might
by voluntary overcollateralisation
anticipate and thus undertake
of the reserve of assets…
actions to avoid negative
consequences.
The deviation measured by this

It might be argued that the RTS
indicator depends on the definition
requires the inclusion of an early
of the assets referenced and, thus,
warning signal which calibration is
on the risk appetite of the issuer.
very difficult for some issuers. This
This is consistent with the option
complexity might challenge the
envisaging its calibration and
proper identification of situations
subsequent potential actions to be
of risk for actions to be taken.
taken by the issuer.
Policy option 2 MiCAR requires the market value of The trigger of the volatility to cover
the reserve assets to amount to at here is not related to market value
18
least the value of the assets changes of the reserve assets only.
referenced. Arguably the market The targeted volatility here is driven
value of the tokens is at least by idiosyncratic related factors
indirectly related to the market linked to the issuer and its risk
value and composition of the appetite and also by market wide
reserve assets. Therefore, the related factors triggered by the
stabililisation mechanism would be general performance of crypto
covering the main target of the assets in markets.
basis risk test already. MiCAR also
envisages a supervisory and
regulatory framework for
cryptoassets markets.
The basis risk test seems to serve

more for the purposes to assess a It could be argued that the
maximum volatility allowed for fundaments of the test seem valid
crypto assets (ARTs and EMTs in to limit the volatility of the token as
MICAR) from the perspective of the an asset for investors but also to
investor, e.g. as a requirement for limit the volatility of the token to
their eligibility as liquid assets in the cover the issuer against the impact
LCR if finally decided so, rather than of a potential subsequent massive
for the purposes of the redemption request or sales with
determination of the composition impact on the stability of markets.
of the reserve assets.
12.The EBA opted for option 1 where issuers of ARTs will need to incorporate an indicator as an
early warning signal to measure differences between the market value of the token and the
market value of the assets referenced. The calibration of the maximum deviation will
correspond to the issuer as well as the actions, if any, to be taken. With this the EBA intends
to cover at least the basis risk test from a qualitative point of view, the calibration being done
by the issuer, to avoid the creation of additional requirements to the MiCAR ones.
19

Question 1. Do respondents have any concerns of Article 1 for the identification,
measurement and monitoring of liquidity risk of issuers? Do respondents
think that the main aspects in the processes for issuers of tokens to properly
manage liquidity risk are captured?
Question 2. Do respondents have any comment on the minimum content of the liquidity
contingency policy proposed in Article 2? In particular, do respondents have
any concern on the inclusion of the required indicator to measure deviations
between the market value of the token and the market value of the assets
referenced as an early warning signal to be calibrated by the issuer?
Question 3. Do respondents find any challenge in the application of the segregation of

the liquidity management policy as envisaged in Article 3?
Question 4. Do respondents have any comment regarding the minimum content

envisaged in Article 4 of these RTS about the liquidity stress testing under
Article 45(4) of MiCAR to be included in the liquidity management policy?
Question 5. Do respondents find any provision unclear to apply?
Question 6. Do respondents have any comment on the impact assessment provided?
20
EBA/CP/2023/25
08 NOVEMBER 2023
Consultation Paper

to further specify the liquidity requirements of the reserve of assets
under Article 36(4) of Regulation (EU) 2023/1114
CONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS TO FURTHER SPECIFY THE LIQUIDITY
REQUIREMENTS OF THE RESERVE OF ASSETS ARTICLE 36(4) OF REGULATION (EU) 2023/1114
Contents
3.3 Overall techniques for liquidity management 9
2
REQUIREMENTS OF THE RESERVE OF ASSETS IN ARTICLES 36 AND 45(3) OF REGULATION (EU) 2023/1114

European Ombudsman.
Data protection
website.
3
Article 36(1) of MiCAR requires issuers of asset-referenced tokens, either if the asset-referenced
tokens are classified as significant or not, to constitute and at all times maintain a reserve of assets.
The target of the reserve of assets is to ensure a timely payment to the holders, upon redemption
request of the tokens at any time, in funds by the market value of the assets referenced or via their
physical delivery.
The requirement of a reserve of assets applies as well to electronic money (e-money) institutions
issuing e-money tokens that are significant by virtue of Article 58(1) of MiCAR and can be expanded
to e-money institutions issuing e-money tokens that are not significant if the competent authority
of the home Member State requires it so following Article 58(2) of MiCAR.
Article 36(4) of MiCAR to establish, in close cooperation with ESMA and the ECB, a percentage of
the reserve of assets with a maturity of no longer than 1 working day, an additional percentage of
the reserve of assets with a maturity of no longer than 5 working days and any additional
percentage of the reserve of assets with any maximum maturity that can be found relevant.
Furthermore, the RTS shall establish overall techniques for liquidity management to further specify
the liquidity requirements of the reserve of assets. Moreover, the RTS shall also establish the
specific minimum amount of deposits in each official currency referenced, which cannot be lower
than 30% of the amount referenced in each official currency if the asset-referenced token is not
significant1 or 60% if the asset-referenced token is significant.
In the development of the mandate the EBA is required to take into account the size, complexity
and nature of the reserve of assets and of the asset-referenced token itself. Furthermore, the EBA
is mandated to take into account the concentration limits of the investment of the assets of
undertakings for collective investment in transferable securities (UCITs) under its regulatory
framework 2 , for the purposes of the establishment of the overall techniques of liquidity
management of the reserve of assets as well as for the percentages of the reserve of assets with
maximum maturities.
Next steps
1
Article 45(7)(b), point (d), of MiCAR has a similar mandate to the EBA to specify in the relevant RTS that minimum
amount of deposits where it comes to tokens referenced to official currencies that are significant.
2
Article 52 of Directive 2009/65/EC
4

1. Article 36 (4) Regulation (EU) 1114/2023 on markets in crypto-assets (MiCAR) mandates the EBA
to develop draft regulatory technical standards (RTS) further specifying the liquidity
requirements of the reserve of assets that issuers of significant assets referenced tokens (ARTs),
non-significant ARTs and e-money institutions issuing significant e-money tokens (EMTs) (as well
as e-money institutions issuing non-significant EMTs if required by the relevant competent
authority)3 shall constitute and at all times maintain. In the development of these draft RTS the
EBA shall take into account the size, complexity and nature of the reserve of assets and of the
asset-referenced token itself.
2. The reserve of assets shall be composed of the assets that the issuer receives and keeps when
issuing the tokens (e.g. deposits with credit institutions, commodities…) and by the highly liquid
financial instruments the issuer may invest in. The deposits in credit institutions cannot be
inferior to 30% (or 60% if required by the competent authority) of the amount referenced in
each official currency for issuers of EMTs and ARTs, if they are not significant, or 60% in the case
of issuers of significant EMTs and ARTs. Those minimum amounts in the form of deposits with
credit institutions do not apply for the cases of assets referenced that are other than official
currencies, for example commodities, financial instruments or crypto assets.
3. Article 36(4) MiCAR envisages that a minimum percentage of the reserve of assets shall mature
within one working day, including reverse repurchase agreements that can be terminated and
funds that can be withdrawn within that period of time, and that another minimum percentage
of it shall do it in no later than five working days. The EBA shall specify in the draft RTS these
percentages as well as any other percentage for another maturity if relevant, and overall
techniques liquidity management of the reserve of assets, taking into account the concentration
limits in the UCITs framework.
4. Furthermore, the EBA shall specify the minimum amount of deposits in credit institutions, which
cannot be lower than 30% of the amount referenced in each official currency, for the cases of
tokens that are not significant, or 60% if the tokens are significant. The mandate to specify that
minimum amount for tokens that are not significant is envisaged under Article 36(4) and the
mandate for such specification for the case of significant tokens is in Article 45(7)(b). For
consistency reasons both are established in these draft RTS.
5. For the development of these RTS, the EBA builds on the 2022 Basel standard on the prudential
treatment of crypto assets exposures from December 2022 4 , the 2023 Basel report on the
definition of the reserve of assets (under work) as well as the UCITs Directive 2009/65 and the
3
As envisaged in paragraph 1 of Article 36 (on issuers of ARTs, irrespective of whether or not they are significant) in
conjunction with paragraph 1 of Article 58 (on e-money institutions issuing significant EMTs) and paragraph 2 of Article
58 (on e-money institutions issuing EMTs that are not significant).
4
https://www.bis.org/bcbs/publ/d545.pdf
5
Commission Delegated Regulation (EU) 2015/61 (“LCR Delegated Regulation”) as envisaged in

MiCAR. The EBA has also taken into account the regulatory framework of money market funds
under Regulation (EU) 2017/1131 and some reports published by the relevant authorities
regarding cases of crisis related to crypto activities.
6. The consultation of these RTS on the definition of liquidity requirements under Article 36(4)
MiCAR is being undertaken in parallel to other two consultations on liquidity related aspects of
issuers of tokens, i.e. the RTS to specify the highly liquid financial instruments in the reserve of
assets envisaged in Article 38(5) MiCAR and the RTS to specify the minimum content of the
liquidity management policy and procedures of issuers of tokens under Article 45(7)(b) MiCAR.
3.1 Minimum percentage of reserve assets with maximum

termination periods of 1 and 5 working days and other potential
maximum maturities
3.1.1 Definition of the reserve assets
7. Assets received by the issuer when issuing the EMTs or ARTs may be kept (e.g. deposits in credit
institutions, commodities…) or invested in highly liquid financial instruments. All of them
integrate the reserve of assets.
8. MiCAR envisages a minimum amount of deposits with credit institutions of 30% (or 60% for
significant ARTs or EMTs) of the asset referenced in each official currency.
9. The EBA has proposed in the draft RTS under Article 38(5) to specify that highly liquid financial
instruments will be composed of Level 1 liquid assets subject to 0% haircut in the liquidity
coverage ratio, Level 1 covered bonds in the liquidity coverage ratio and financial instruments
used as assets referenced or derivatives relating to them in the case of ARTs referenced to other
than official currencies.
10.The percentages established in these RTS of the reserve of assets with maximum termination
periods of 1 and 5 working days apply to all the relevant reserve assets together, i.e. deposits in
credit institutions and highly liquid financial instruments.
3.1.2 Size, complexity and nature of the assets referenced token and of the
reserve of assets under this requirement and calibration
a. Tokens referenced to official currencies
11.The mandate under Article 36(4) MiCAR requires to develop the draft RTS “taking into account
the size, complexity and nature of the reserve assets and of the asset-referenced token itself”.
6
12.The requirements in Article 36(4)(a) and Article 36(4)(b) of MiCAR to establish minimum
percentages of reserve assets with maximum maturities seem to be mainly referred to the
period of time to receive cash from withdrawable deposits with credit institutions and to the
termination of reverse repos. This is related to the capacity of these reserve assets of generating
readily available funds to be used for redemption of tokens. The requirement does not seem to
be relevant as regards the time to maturity of securities and its effectiveness to redeem tokens
since securities might always be liquidated via sales or repos. A maturity requirement of 1 or 5
day maturity does not seem a logical way to ensure that a security within the reserve of assets
will not be subject to price volatility risk. Under such extremely short residual maturity the
market value of the security is close, if not equal, to its nominal value and will in practice make
the security non-tradable which would exclude it from the reserve of assets.
13.The legislator requires a minimum amount of deposits with credit institutions in the case of
tokens referenced to official currencies only. The minimum amount of deposits with credit
institutions required in tokens referenced to official currencies is material in the reserve of
assets, i.e. 30% of the amount referenced in each official currency or 60% if the token is
significant. Tokens referenced to official currencies need to always be redeemed by payment in
funds. Therefore, to ensure that the reserve of assets can generate at all times enough funds to
fulfil redemption requests in funds, it is necessary that deposits (or reverse repos) within such
reserve of assets have a short maturity (1 or 5 working days).
14.For these reasons the EBA proposes to require these minimum percentages in Article 36(4)(a)
and Article 36(4)(b) of MiCAR to tokens that are referenced to official currencies.
b. Tokens that are not referenced to official currencies
15. The EBA also highlights that even though in the case of tokens that are not referenced to official
currencies the reserve of assets is not required to include deposits with credit institutions, the
issuer can decide to hold deposits with credit institutions in the reserve of assets. Redemption
in funds applies to tokens where the issuer received funds upon their issuance and committed
to redeem in funds if the token holder would decide so. Therefore, to ensure that the reserve of
assets, in the case of tokens referenced to other than official currencies but where the reserve
of assets includes deposits with credit institutions (or reverse repos), can generate at all times
enough funds to fulfil redemption requests in funds, it is necessary that a minimum amount of
those deposits (or reverse repos) have a short maturity (1 or 5 working days).
16.These draft RTS envisage minimum percentages of the deposits with credit institutions or
reverse repos held in the reserve of assets of these tokens, with maximum maturities of 1 or 5
working days, following the mandate in Article 36(4)(c).
17.These minimum percentages do not apply to the reserve of assets of tokens that are not
referenced to official currencies and where their reserves of assets do not include deposits with
credit institutions or reverse repos. In the case of tokens referencing a combination of official
currencies with assets other than official currencies the minimum percentages apply as
7
indicated for the part of the amount referencing official currencies and the part of the amount
referencing other than official currencies.
c. Calibration of the minimum percentages of the reserve of assets, in the token

referenced to official currencies, and of the minimum percentages of the deposits
with credit institutions or reverse repos in tokens referenced to other than official
currencies.
18.Furthermore, for the calibration of the percentages the EBA differentiates between significant
tokens and those that are not significant. The minimum required amount of deposits with credit
institutions is different (60% and 30%, respectively, of the amount referenced in each official
currency) and thus it seems logical to ensure that the full amount of these deposits is effective
for a prompt redemption of tokens upon request at any time, including under stress. Moreover,
a token is significant if, among other things, it is highly interconnected to the financial system
and has a more international scope. Therefore, higher percentages for significant tokens may
mitigate any contagion risks.
19.With this proposed scope of the requirement, applicable to tokens referenced to official
currencies and to those referenced to other than official currencies where the reserve of assets
include deposits with credit institutions or reverse repos, and with a different calibration if
significant or not, the EBA, following the mandate in Article 45(7)(b), takes into account and
differentiates by size, complexity and nature of the reserve assets and of the asset-referenced
token itself.
20.The EBA has based its proposed calibration of the relevant percentages of reserve assets that
need to mature within the following 1 and 5 working days, on the recent evidence of deposit
run-offs in bank related to crypto related activities5 and the comparable money market funds
Regulation6.
21.The EBA has assessed the relevance of a percentage of the reserve of assets maturing or being
able to be withdrawn or terminated in the short-medium term beyond 1 or 5 working days.
Duration of the reserve assets and subsequent sensitivity to interest rate changes that might
trigger volatility related aspects would be addressed here. The shorter the residual contractual
maturity of the reserve assets the lower their volatility. The EBA considers that setting a
maximum short-medium term maturity in bonds is more related to control interest rate risk
rather than to liquidity risk requirements whose further specification is the target of this RTS as
established under Article 36(4) of MiCAR. The EBA considers that minimum requirements for
other maximum maturities than 1 or 5 working days in the short-medium term in the reserve of
assets are not relevant for the purposes of fulfilling redemption requests.
5
20% run off from relevant deposits in one day in the case of Signature Bank (FDIC’S SUPERVISION OF SIGNATURE
BANK).
6
Money market funds with stable net asset value are required to hold a minimum 10% of their assets maturing within one
day and 30% of their assets within one week. These money market funds are comparable with the least volatile tokens, as
referenced to official currencies.
8
3.2 Determination of the minimum amount of deposits with

banks in the case of issuers of EMTs or ARTs referenced to official
currencies
22.Point (d) of Article 36(4), together with Article 58(1) and (2), of MiCAR establishes that the
amount of deposits with credit institutions cannot be lower than 30% of the amount referenced
in each official currency, in the case of issuers of ARTs that are not significant or e-money
institutions issuing EMTs that are not significant if required by the relevant competent authority.
This percentage is 60% for the cases of issuers of ARTs or EMTs that are significant.
23.The EBA considers that an amount of bank deposits in the reserve of assets higher than those
percentages of the amount of assets referenced in tokens might trigger concerns from the
perspective of the liquidity of the reserve assets overall and their exposure to credit risk. The
EBA considers that it is key to keep a relevant amount of the reserve of assets as susceptible to
be liquidated in the market and not just with specific counterparties. Furthermore, the
interconnectedness between the banking system and crypto-asset sector should be well
controlled to avoid reciprocal contagion effects in case of distress of one of them. Therefore,
the EBA considers that the minimum amount of bank deposits in the reserve assets should not
be set at a higher default level than those percentages of the amount referenced in each official
currency.
24.Still on a case-by-case basis competent authorities are able to increase the minimum 30% up to
a minimum 60% in the case of ARTs that are not significant (following Article 35(4) together with
Article 45(3) and 45(7)) and in the case of EMTs that are not significant and are issued by e-
money institutions (following Article 58(1) and (2) together with Article 45(3) and (7)).
3.3 Overall techniques for liquidity management

25.Token holders are entitled to request at any time the redemption of their tokens by an amount
equal to the market value of the assets referenced. Issuer of ARTs and EMTs need to manage
the reserve of assets to ensure that the market value of the reserve assets is at least equal at
any time to the market value of the assets referenced. Any loss of value of the former relative
to the latter need to be covered by the issuer with additional reserve assets (Article 38(4)).
26.MiCAR has specific provisions seeking to ensure that the reserve assets cover the amount of the
assets referenced at any time. The composition of the highly liquid financial instruments shall
be made by assets with minimum market risk, credit risk and concentration risk (Article 38(1)).
The reserve of assets needs to be managed considering the liquidity risks inherent to the
permanent rights of redemption held by the token holders (Article 36(1)(b)).
27.A concern here for the EBA is to mitigate the risk that the amount of the reserve of assets can
become lower than the market value of the assets referenced due to various reasons:
9
a. Within the requirements of the reserve assets under Article 38(1) the EBA considers
necessary to mitigate the concentration risk of highly liquid financial instruments,
which is part of the mandate to the EBA in the RTS to specify highly liquid financial
instruments under Article 38(5), as well as of the deposits with credit institutions
in the reserve of assets under the mandate in Article 36(4) in the context of overall
techniques for liquidity management.
b. Furthermore, under Article 38(1) the EBA deems necessary the mitigation of
liquidity and credit risk of highly liquid financial instruments, which is inherent to
the RTS specifying them under Article 38(5), but also of bank deposits in the reserve
of assets under the mandate in Article 36(4) in the context of overall techniques for
liquidity management.
c. Article 38(1) also envisages the need to minimize market risk in highly liquid
financial instruments for which specific consideration of hedges in place are
envisaged in the RTS to specify highly liquid financial instruments under Article
38(5).
d. Volatility of the assets referenced, particularly considering the permanent right of

redemption by the token holders including during stress scenarios:
i. Special consideration here is the inclusion of the financial instruments used

as assets referenced, or derivatives relating to them, in the definition of
highly liquid financial instruments in the case of ARTs for the part of assets
referenced to other than official currencies seeking a minimum correlation.
This is envisaged for the relevant draft RTS under Article 38(5).
ii. The reserve of assets needs to be managed considering the liquidity risks
inherent to the permanent rights of redemption held by the token holders
(Article 36(1)(b)). This might encompass voluntary over-collateralisation.
iii. Mandatory over-collateralisation of the reserve assets.
28.The EBA proposes the inclusion of the following safeguards in the context of a proper liquidity
management of the liquidity requirements of the reserve of assets of issuers of ARTs and EMTs
and takes into account the nature, size and complexity of the reserve of assets and of the asset
referenced token. These techniques will ultimately target to contribute to the effectiveness in a
timely manner of the reserve of assets.
3.3.1 Minimum creditworthiness and liquidity soundness in the bank deposits

counterparties
29.The EBA considers that ensuring a minimum creditworthiness and liquidity soundness in the
bank deposit counterparties will mitigate their credit and liquidity risk in the reserve assets of
issuers of tokens.
10
30.In setting minimum requirements to mitigate the liquidity and credit risk of these deposits, the
EBA follows an approach to ensure that credit institutions from all EU Member States can be
eligible. The EBA considers eligible deposit counterparties for the purposes of considering those
deposits in credit institutions in the reserve of assets, those where the issuer has no reason to
expect non-performance of the credit institution – this is based on Article 32(1) of the LCR
Delegated Regulation and the LCR eligibility of inflows including those stemming from deposits
31.This safeguard should be read in conjunction with the requirement established in the RTS
specifying the minimum content of the liquidity management policy and procedures under
Article 45(7)(b) MiCAR where the issuer needs to assess the creditworthiness of the bank
counterparty and ensure that it is in line with its risk appetite and taking into account the final
volume of bank deposits in the reserve of assets.
3.3.2 Concentration limits by bank deposit counterparty
32.The EBA considers that limiting to the issuer of the tokens the amount of deposits in the reserve
of assets with the same credit institution contributes to a sound credit and liquidity
management.
33.A high concentration of deposits with a limited number of banks shall be avoided. This is to
mitigate the risk arising from material interconnectedness between the financial system and the
crypto ecosystem. A priori, it might be argued that larger banks might find fewer challenges for
additional liquidity resources if needed in case of stress, for example via securitisations, new
issuances in wholesale markets, repo markets or others where some minimum infrastructure is
needed. Diversification across counterparties should be complemented with limits to avoid
concentration of deposits within the total balance sheet of the credit institution receiving the
deposits. This is to mitigate the risk that withdrawal from deposits by the issuer to redeem
tokens might trigger very material repayment of liabilities by the credit institution taking the
deposits that might ultimately challenge the withdrawal and redemption.
34.The EBA considers that in the application of such concentration limits the issuer shall consider
in an aggregated manner, as an only counterparty, the deposits it holds with a credit institution
as well as the deposits it holds with all other entities that form part of the group of that credit
institution and the deposits it holds with entities with which that credit institution has close
links.
3.3.3 Over-collateralisation
35.Ultimately the issuer’s reserve of assets at market value aims to ensure the timely redemption
of the tokens upon request at any time, including stress periods, by paying in funds the market
value of the assets referenced or physical delivery of them. Article 36(7) envisages that the
aggregate value of the reserve of assets shall be at least equal to the aggregate value of the
assets referenced, thus recognizing the possibility of mandatory overcollateralisation. The EBA
proposes to include a minimum mandatory overcollateralisation in the context of the techniques
11
for liquidity management of the reserve of assets where the size, complexity and nature of the
reserve of assets and of the asset-referenced token itself will be taken into account.
36.The main target of overcollateralisation is to contribute to mitigating market risk in the reserve
of assets and the differences between the changes in the market value between the reserve of
assets and the assets referenced. It mitigates the risk of a potential de-pegging in tokens
referenced to official currencies. De-pegging refers to cases where the parity is lost because
some reputational, solvency or other reasons that make the market value of the token be below
parity and that might trigger massive redemption request with subsequent damaging
consequences to the issuer and the system if redemption cannot be met in time in a proper
manner.
37.For these reasons the EBA proposes the inclusion of a mandatory over-collateralisation of the
reserve assets to complement, particularly under stress times, the stability mechanism of ARTs
and EMTs by contributing to mitigate price volatility risks and subsequent impact. The
calibration proposed will only require mandatory overcollateralization in cases where the
reserve of assets itself, taking into account its composition, potential voluntary
overcollateralization and hedging derivatives, has not proved enough to cover the volatility of
the assets referenced.
12
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of XXX

Council with regard to regulatory technical standards for further specifying the
liquidity requirements of the reserve of assets set out in Articles 36 and 45(3)
Article 36(4), fifth subparagraph, and Article 45(7), fourth subparagraph, thereof,
Whereas:
(1) In the determination of the minimum amount of the reserve of assets maturing in one
or five working days, including assets recevied in reverse repos that can be terminated
in one or five working days or deposits withdrawable with a one- or five-working-day
prior notice, it is necessary to follow the calibration established in Regulation (EU)
2017/1131 of the European Parliament and of the Council of 14 June 20178 and to
draw on the experience of observed empirical crises related to crypto-activities. Such
a minimum amount should be calibrated to ensure the ability to meet the redemption
requests by token holders at any time, including under stress. Its calibration should
take into account the size, complexity and nature of the reserve of assets and of the
asset-referenced tokens, and differentiate tokens that are not significant from those that
are significant, and which have an higher amount of required deposits in each official
currency referenced, as well as crypto-activities with a higher interconnectedness with
the financial system or a higher international scope. Conversely, it is unnecessary to
introduce other longer maturities requirements to address the same risks.
(2) It is necessary to take into account the benefits and potential risks that could arise as a
consequence of the reserve of assets being potentially made of a large amount of
deposits with credit institutions. In order to ensure a proper liquidity management of
those deposits, it is necessary to introduce specific techniques for it to mitigate
potential risks. Considering the potential material size of this part of the reserve of
assets, any failure of the counterparty bank or simply a sudden and large withdrawal
of these deposits as a consequence of redemption requests might trigger significant
negative consequences to the financial stability. For these purposes, it is necessary to
7
OJ L 150, 9.6.2023, p. 40.
8
Regulation (EU) 2017/1131 of the European Parliament and of the Council of 14 June 2017 on money market funds (OJ
L 169, 30.6.2017, p. 8).
EN 14
EN
specify liquidity requirements of the reserve of assets in the form of required liquidity
management techniques of the deposits held in the reserve of assets.
(3) The sound management of the reserve of assets dictates that the credit institutions, with
whom such reserve assets are deposited, are subject to creditworthiness requirement
calibrated in a way that creditworthy credit institutions can be found in any Member
State. Sound management should also ensure that token redemption is facilitated and
not prevented or hindered. Therefore, adequate diversification must be ensured and
concentration limits should be set out. These limits should concern the maximum
amount of the reserve of assets that can be deposited in a single credit institution and
the threshold should be set both against the total reserve of assets and against the credit
institution’s total balance sheet. These thresholds are necessary to ensure both that an
adequate number of credit institutions can be approached for redemption and that
redemption will not be hindered by its potential high impact on a single credit
institution’s total balance sheet.
(4) Finally, to ensure a sound liquidity managemet of the reserve of assets, it is necessary
to introduce a minimum mandatory overcollateralisation of the market value of the
reserve of assets relative to the market value of the assets referenced, with the aim to
cover the absence of haircuts in the computation of the highly liquid financial
instruments in the reserve of assets, to mitigate the volatility and seek for correlation
of the market value of the assets referenced with respect to the reserve of assets. The
mandatory overcollateralisation should be calibrated to follow a historical look-back
approach, taking into account the size, complexity and nature of the reserve of assets
and of the assets referenced by the tokens.
(5) The minimum amount of deposits with credit institutions to be held in the reserve of
assets related to tokens that are not significant and are referenced to official currencies
should be kept to 30% of the amount referenced, or to 60% if the token is significant,
and not raised any higher, as those percentages represent a good balance between the
benefits for a timely redemption of the tokens upon request, and the risk of potential
contagion in case of a crisis arising from the interconnectedness between crypto-
activities and the financial system.
(6) Considering that requirements set out in Articles 36 and Article 45(1) to (4) of
Regulation (EU) 2023/1114 also apply to electronic money institutions issuing e-
money tokens (either significant or, where decided, non-significant), as per Article
58(1), point (a), and (2) of that Regulation, this Regulation should also apply to issuers
of e-money tokens that are subject to or required to comply with those requirements.
(8) The European Banking Authority, in close cooperation with the European Supervisory
Parliament and of the Council9 and with the European Central Bank, has conducted
EN 15
EN
open public consultations on the draft regulatory technical standards on which this
Regulation is based, analysed the potential related costs and benefits and requested the
advice of the Banking Stakeholder Group established in accordance with Article 37 of
Regulation (EU) No 1093/2010 of the European Parliament and of the Council,10
Article 1
Maximum maturities applicable to the reserve of assets related to tokens referencing to
official currencies
1. The reserve of assets referred to in Article 36 of Regulation (EU) 2023/1114 that

relate to tokens referencing to official currencies shall include assets with an
individual residual maturity of no longer than one working day and having a total
market value equal to at least 20% of the market value of the entire reserve of assets
referred to the same tokens.
Where the reserve of assets referred to in Article 36 of Regulation (EU) 2023/1114
relates to significant tokens referencing to official currencies, the percentage referred
to in the first subparagraph shall be 40%.
Reverse repurchase agreements that can be terminated by giving prior notice of one
working day and cash that can be withdrawn by giving prior notice of one working
day shall be included in the percentages referred to in the first and second
subparagraphs.
2. The reserve of assets referred to in Article 36 of Regulation (EU) 2023/1114 that
relate to tokens referencing to official currencies shall include assets with individual
residual maturity of no longer than five working days and having a total market value
equal to at least 30% of the market value of the entire reserve of assets referred to the
same tokens. That percentage shall be calculated including the assets with individual
residual maturity of no longer than one working day referred to in paragraph 1, first
subparagraph.
Where the reserve of assets referred to in Article 36 of Regulation (EU) 2023/1114
relates to significant tokens referencing to official currencies, the percentage referred
to in the first subparagraph shall be 60% and shall be calculated including the assets
with individual residual maturity of no longer than one working day referred to in
paragraph 1, second subparagraph.
Reverse repurchase agreements that can be terminated by giving prior notice of five
working days and cash that can be withdrawn by giving prior notice of five working
days shall be included in the percentages referred to in the first and second
subparagraphs.
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Article 2
Maximum maturities applicable to the reserve of assets related to tokens not referencing to
official currencies
1. In the case of tokens that are not referenced to official currencies, at least 20% of the
reverse repurchase agreements and cash included in the reserve of assets referred to
in Article 36 of Regulation (EU) 2023/1114 shall be able to be terminated or
withdrawn, respectively, by giving prior notice of one working day.
In the case of significant tokens that are not referenced to official currencies, the
percentage referred to in the first subparagraph shall be 40%.
2. In the case of tokens that are not referenced to official currencies, at least 30% of the
reverse repurchase agreements and cash included in the reserve of assets referred to
in Article 36 of Regulation (EU) 2023/1114 shall be able to be terminated or
withdrawn, respectively, by giving prior notice of five working days.
In the case of significant tokens that are not referenced to official currencies, the
percentage referred to in the first subparagraph shall be 60%.
The percentages referred to in the first and second subparagraphs shall be calculated
including the assets referred to in paragraph 1, first and second subparagraphs,
respectively.
Article 3
Deposits with credit institutions
1. Issuers of asset-referenced tokens referenced to official currencies and/or, where

applicable, e-money institutions issuing e-money tokens shall hold in their reserve of
assets deposits with credit institutions in each official currency referenced by the
tokens and equal to at least 30% of the amount referenced in each official currency.
2. Issuers of significant asset-referenced tokens referenced to official currencies and/or,
where applicable, e-money institutions issuing significant e-money tokens shall hold
in their reserve of assets deposits with credit institutions in each official currency
referenced by the tokens and equal to at least 60% of the amount referenced in each
official currency.
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Article 4
Minimum creditworthiness and liquidity soundness of bank deposit counterparties in the
reserve of assets
1. Issuers of asset-referenced tokens and/or, where applicable, e-money institutions

issuing e-money tokens holding deposits with credit institutions shall have no reason
to expect non-performance by the credit institutions taking the deposits in order to
include those deposits in the reserve of assets referred to in Article 36 of Regulation
(EU) 2023/1114.
Article 5
Concentration limit by bank deposit counterparty
1. The deposits in credit institutions that are included in the reserve of assets referred
to in Article 36 of Regulation (EU) 2023/1114 shall not be placed with the same
credit institution by an amount higher than 10% of the market value of the reserve of
assets referred to the same tokens. Where the credit institution receiving the deposit
does not qualify as a large institution as defined in Article 4(1), point (146), of
Regulation (EU) No 575/2013, that percentage shall be 5%.
2. The deposits in a credit institution that are included in the reserve of assets of the
same tokens referred to in Article 36 of Regulation (EU) 2023/1114 shall not exceed
2.5% of the total assets of the credit institution receiving those deposits.
3. The amount of the deposits in a credit institution referred to in paragraphs 1 and 2
together with the market value of highly liquid financial instruments in the form of
securities or money market instruments issued or guaranteed by the same credit
institution, as well as the risk exposure to that credit institution in unmargined OTC
derivatives, as envisaged in Article 38(1) of Regulation (EU) 2023/1114, shall not
exceed 25% of the market value of the reserve of assets referred to the same tokens.
4. For the purposes of the limits envisaged in paragraphs 1, 2 and 3, the deposits with a
credit institution, the highly liquid financial instruments in the form of securities or
money market instruments issued or guaranteed by the same credit institution, as well
as the risk exposures in unmargined OTC derivatives with that credit institution shall
include those deposits placed with, instruments issued by or exposures to all other
entities with whom that credit institution has close links.
5. When applying paragraphs 1, 2, 3 and 4, token issuers shall look through to the
underlying exposures of collective investment undertakings (CIUs), as defined in
Article 4(1), point (7), of Regulation (EU) No 575/2013, whose units are included in
the reserve of assets.
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EN
Article 6
Mandatory over-collateralisation
1. At any time 𝑡, the daily market value of the reserve of assets referred to the same
tokens shall meet the following formula:
𝑅𝑒𝑠𝑒𝑟𝑣𝑒_𝐴𝑠𝑠𝑒𝑡𝑠𝑡 ≥
max{𝐴𝑠𝑠𝑒𝑡𝑠_𝑅𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒𝑑𝑠−𝑖 }4𝑖=0 −min{𝑅𝑒𝑠𝑒𝑟𝑣𝑒_𝐴𝑠𝑠𝑒𝑡𝑠𝑠−𝑖 }4𝑖=0
𝐴𝑠𝑠𝑒𝑡𝑠_𝑅𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒𝑑𝑡 × (1 + max {0; max{𝐴𝑠𝑠𝑒𝑡𝑠_𝑅𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒𝑑𝑠−𝑖 }4𝑖=0
}),
𝑠∈𝐼
where:
- 𝑅𝑒𝑠𝑒𝑟𝑣𝑒_𝐴𝑠𝑠𝑒𝑡𝑠𝑡 is the market value at time 𝑡 of the reserve of assets referred
to the same tokens;
- 𝐴𝑠𝑠𝑒𝑡𝑠_𝑅𝑒𝑓𝑒𝑟𝑒𝑛𝑐𝑒𝑑𝑡 is the market value at time 𝑡 of the assets referenced by
those tokens;
- 𝐼 is any set of 5 consecutive working days in the 5-year period before date 𝑡.
Article 7
Entry into force
Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
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the potential costs and benefits of the draft Regulatory technical standards (RTS). RTS developed
by the EBA shall therefore be accompanied by an Impact Assessment (IA) that analyses ‘the
potential related costs and benefits’.
2. This analysis presents the IA of the main policy options included in this Consultation Paper on
the draft RTS further specifying the liquidity requirements of the reserve of assets, which the
EBA is mandated to develop under Article 36(4) of Regulation (EU) 1114/2023.
3. Article 36(4) mandates the EBA to establish the percentages of the reserve of assets with
maximum maturities of 1 working day and 5 working days, including the reverse repos that are
able to be terminated and the cash that can be withdrawn in those tenors. The EBA has assessed
the calibration approach to determine these percentages. In addition to this, the EBA is
mandated to assess the establishment of other relevant maturities. The EBA has also analysed
the relevance or need to add other minimum percentages of reserve assets with other
maturities in the short-medium term beyond 5 working days.
4. Furthermore, Article 36(4) mandates the EBA to establish overall techniques for liquidity
management. The EBA has assessed here the convenience of introducing specific techniques in
the RTS to be applied by issuers of tokens that would cover specific risks in the reserve of assets
and that would result in a sound liquidity management of the reserve of assets. The techniques
proposed include in particular:
a. techniques to ensure minimum liquidity soundness and credit quality in the

counterparties of the deposits with credit institutions in the reserve of assets.
b. techniques to ensure a maximum concentration limit by counterparty of deposits

with credit institutions in the reserve of assets.
c. techniques to ensure a minimum overcollateralization. It intends to cover the risk

that the market value of the reserve of assets cannot cover the market value of the
assets referenced for the purposes of meeting redemption request by the token
holders at any time. This risk is very much related to the volatility of the reserve
assets and assets referenced if not sufficiently correlated. In this context is also
covers the absence of the haircuts to the highly liquid financial instruments. Its
calibration follows to a great extent the regulatory framework for similar aspects
20
in the money market funds and also the experience observed in banking crisis
stemming from crypto activities.
5.1.1 Maximum 1 and 5 working days maturities for minimum percentages of

the reserve of assets
5. The EBA has assessed two policy options for the calibration of those percentages:
- Policy option A: To specify the minimum percentages based on the evidence experienced
in banks’ run-off cases from deposits stemming from crypto activities as well as considering
comparable regulatory frameworks with similar safeguards like the Regulation11 on money
market funds.
- Policy option B: To describe the general lines of an approach where ultimately the
calibration of the percentages should be made by the issuer. The percentages would be
based on its particular historical observations and estimated following 99% confidence
intervals relative to the average redeemed amount in the worst 1 and 5 working days in
terms of gross outflows.
On the one hand it builds on

recent bank related data of
experienced deposits run-off
related to crypto activities in the
referenced periods of time (1 and
5 working days).
Second, the Regulation on money There is a need to somehow adjust

market funds envisages the observed cited deposits run-off
specifically the percentages of and regulatory framework of money
Policy option A their assets that need to mature market funds to differentiate
on a daily and weekly basis for between significant and non-
liquidity soundness purposes. This significant tokens.
serves as a comparable
framework considering the
similarities between the business
activities of money market funds
and tokens’ issuers.
This approach takes into account

the type of token (significant vs
11
Regulation (EU) 2017/1131
21
non-significant), reserve of assets

(only applicable to tokens
referenced to official currencies,
with material amount of
deposits), size and complexity
(again differentiation between
significant and non-significant).
The calibration is not subject to an

ongoing update based on the reality
of stressed redemption outflows that
evidence might show overtime for a
specific issuer. However, taking into
account the relevance of this aspect
to avoid any liquidity distress in the
issuer, the general crypto market and
This approach does not pose any the interconnected global financial
operational burden for issuers as system the Guidelines on liquidity
regards the calibration of the stress testing under Article 45(8)
percentages of the reserve of MiCAR might include, along the lines
assets maturing within 1 or 5 proposed under policy option 2, the
working days. need for the issuer to assess
expected potential withdrawals
under stress of the deposits placed in
credit institutions, or termination of
reverse repos, within 1 or 5 working
days beyond the percentages
established in these RTS for potential
strengthening of the liquidity
requirements.
Consideration of specificities of
Lack of experience and time series
the issuer is made since it is an
data that could underestimate the
analysis to be run on a case-by-
necessary amount maturing up to 1
case basis: token type, reserve of
or 5 working days during at least the
assets, size, complexity, as
first years of functioning of the issuer.
Policy option B required in the mandate.
Ongoing update aligned to the

current circumstances of the Operational burden for issuers for its
experience of the issuer and the calibration every day.
crypto system.
22
6. The EBA has opted for option A to specify the relevant percentages of reserve assets that need
to mature within the following 1 and 5 working days. The EBA builds its proposed calibration,
20% of the reserve of assets maturing within one working day and an additional 10% of the
reserve of assets maturing within 5 working days, on the recent evidence of deposits run-off in
a bank stemming from crypto related activities12 and on the comparable money market funds
Regulation13. For significant tokens, with a higher interconnectedness to the financial system
and subsequent higher contagion risk, where the minimum amount required of deposits with
credit institutions is 60% of the assets referenced in each official currency (versus 30% in the
tokens that are not significant) those percentages are proposed to be proportionately increased
to 40% and 20% for maturities within one working day and 5 working days to ensure the
effectiveness of the full amount of the deposits for a timely redemption of the token upon
request, including under stress periods.
5.1.2 Other relevant maturities
7. The EBA has considered two policy issues:
a. Policy issue I: the possibility to ensure a maximum maturity of 1 or 5 working days

to a minimum percentage of deposits with credit institutions or reverse repos in
the case of tokens that are not referenced to official currencies.
b. Policy issue II: the possibility to implement other longer than 1 or 5 working days
maximum maturities to a minimum percentage of the reserve of assets.
Policy issue I:
8. The EBA has assessed two alternatives:
- Policy option A: to expand the application of the minimum percentages of the reserve of
assets maturing within 1 or 5 working days in tokens referenced to official currencies to
other tokens but relative to the amount of the deposits with credit institutions or reverse
repos in the reserve of assets.
- Policy option B: to keep the minimum percentages of the reserve of assets maturing within
1 or 5 working days for tokens referenced to official currencies only.
12
20% run off from relevant deposits in one day in the case of Signature Bank (FDIC’S SUPERVISION OF SIGNATURE
BANK).
13
Money market funds with stable net asset value are required to hold a minimum 10% of their assets maturing within one
day and 30% of their assets within one week. These money market funds are comparable with the least volatile tokens, as
23
It ensures that the deposits with

credit institutions or reverse
repos in the reserve of assets of
tokens referenced to other than
official currencies can be
withdrawn or terminated in the It might be argued that this
very short term to be able to requirement is only necessary for
meet redemption requests at tokens referenced to official
any time in a prompt manner, currencies where deposits with credit
even under stress, and avoid institutions are material since
potential subsequent worse required to amount to at least 30%
consequences that could arise (or 60% if the token is significant) of
from a failure to redemption in the assets referenced.
time, e.g. massive redemption
request arising and potential
systemic risk to the rest of
tokens issuers and the financial
Policy option A
system.
Incentivises issuers to seek for a

replica in the reserve of assets
(e.g. token referenced to gold)
with respect to the asset
referenced in the case of tokens Correlation between market volatility
that are not referenced to of the reserve of assets and assets
official currencies. These tokens referenced other than official
are a priori expected to be currencies might be argued to be able
exposed to a higher volatility in to be achieved via other instruments,
the assets referenced and to a e.g. hedging derivatives, without the
lower correlation between the need to set additional requirements.
assets referenced and the
reserve of assets unless the
latter replicates to a minimum
extent the former one.
Focusing on tokens referenced

This risk would not be covered for
Policy option B to official currencies, where a
potential cases where the reserve of
material amount of deposits is
assets of tokens referenced to other
required, is enough to cover the
24
main risk arising from a potential than official currencies would include
maturity gap between deposits deposits or reverse repos.
or reverse repos and any
redemption request of tokens
Still proportionality applies since the

requirement of minimum
percentages apply to the amount of
Further operational and
the deposits or reverse repos.
regulatory burden for tokens
Therefore it applies in a
where expectedly the deposits
proportionate manner and even in
or reverse repos might be non-
the absence of them this
material.
requirement does not apply to tokens
referenced to other than official
currencies.
9. The EBA has opted for Policy option A. From a prudential point of view it is crucial to ensure not
only that the amount of the reserve of assets is at least equal to the value of the assets
referenced, as required by MiCAR, but also that it is effectively available at any time for the
redemption of the tokens. This applies for all tokens where the reserve of assets include deposits
with credit institutions or reverse repos.
Policy issue II:
10.The EBA has assessed two alternatives:
- Policy option 1: To require a minimum percentage of the reserve of assets to have a

maximum maturity in the short/medium term, beyond 5 working days.
- Policy option 2: To not require a maximum short/medium maturity for a part of the reserve
assets.
A short-medium term maximum

To make the portfolio less required maturity is more related to
sensitive to interest rate changes interest rate mitigation tools rather
and, thus, expect lower volatility. than to liquidity risk in the short term
Policy option 1
This helps to reinforce stability in in case of a material and sudden
the market value of the reserve redemption request, including stress
assets. test periods. The interest rate risk
might be covered with derivatives,
25
for example, without the need to

impose short-medium term
maturities.
The risk of setting too many

To ensure diversification of the
restrictions for the eligibility of highly
composition of the reserve assets
liquid financial instruments,
by time maturity buckets and,
particularly in the case of tokens
thus, different market liquidity
referenced to other than official
features depending on maturities.
currencies.
To provide more flexibility to

issuers in the development of
their business models. Setting
The risk of having a reserve of assets
additional maturity limits might
with long term maturity subject to
trigger unnecessary lower yield in
higher risks.
short-medium term reserve assets
when related risks might be
Policy option 2
covered with derivatives.
Operational challenges to A higher residual maturity on average

calibrate other maturities for the for the portfolio, in the absence of
reserve of assets that are not further maturity constraints, is an
linked to the need to ensure indicator generally of lower market
redemption of tokens at any time. liquidity in the portfolio.
11.The EBA has opted for policy option 2 and not to introduce additional maturity constraints to
the reserve assets at the moment. The risk of constraining the issuer’s business models seems
higher than the risk that would be controlled with these restrictions which, on the other hand,
can be mitigated via derivatives.
5.1.3 Minimum creditworthiness and liquidity soundness in deposits in credit

institutions in the reserve of assets
12.The EBA has assessed the following two alternatives:
- Policy option A: to require no expectation of non-performance from the bank receiving the
deposits to seek for minimum creditworthiness and liquidity soundness in the deposits with
credit institutions.
- Policy option B: No minimum requirements
26
To mitigate credit risk and liquidity

risk with respect to the deposits
with credit institutions in the
reserve of assets.
The approach might trigger
operational issues since a change in
With this approach the risk of
the creditworthiness expectations of
failure to repay the deposit in time
Policy option A a bank counterparty making it
is mitigated. This is important to
become ineligible would trigger the
ensure that redemption to token
need of a change in the composition
holders upon request at any time,
of the deposits by counterparties.
including under stress, can be met
and mitigate the risk to expanding
the risk of default to the financial
stability.
Compliance with solvency

requirements does not avoid
potential failure to repay in time
those deposits particularly under
stress times. To recall that
redemption of tokens as requested
A minimum creditworthiness is by holders needs to be met at any
not necessary to be required for time in a prompt manner. Ensuring a
deposits to be eligible since it is minimum creditworthiness mitigates
implicit in the solvency at least partially counterparty credit
Policy option B
requirements of the banks and risk. A similar approach is envisaged
thus all bank complying with in the LCR for the recognition of
solvency requirements should be inflows. A related analysis of the
eligible. creditworthiness of the bank
counterparty is also envisaged in the
minimum content of the liquidity
policy management of issuers of
tokens as proposed for the RTS to
specify this minimum content under
Article 45(7)(b) MiCAR.
13.The EBA has opted for option A since the need to provide mitigating tools to the liquidity and
credit risk in the deposits with banks prevails versus potential higher costs/operational issues.
27
The interconnectedness between the banking system and crypto activities requires to
implement prudent approaches of this kind to avoid any expansion of any risk to the financial
system.
5.1.4 Concentration limits by counterparty of deposits in credit institutions in

the reserve of assets
14.The EBA has assessed the following two alternatives:
- Policy option A: To include concentration limits by deposit counterparty.
- Policy option B: to not include concentration limits by deposit counterparty.
This requirement, together with a

minimum credit quality and liquidity
If highly concentrated, any failure
soundness in the deposits taking
to payment in time, by one or two
institutions, might require higher
banks for example, would
operational and economic efforts for
challenge the timely redemption
the issuers of tokens to identify
of tokens with subsequent
eligible credit institutions as
implications in the reliability of
counterparties taking into account
the token as a means of payment
that the issuers, as established in the
and in the whole crypto
RTS on the minimum content of the
ecosystem. This could trigger
liquidity risk management policy and
potential expanded effects to the
procedures under Article 45(7)(b)
whole financial system if the
Policy option A MiCAR, need to develop and include
stress is transferred to holders of
in the liquidity risk management
other tokens or if the funding of
policy the assessment of the
the deposit taking institution is
creditworthiness of each credit
highly concentrated by deposit
institution where the issuer of tokens
stemming from the same issuer in
hold deposits within the reserve of
case it needs to face significant
assets.
redemption requests.
The calibration takes into account A higher diversification requirement

the UCITs framework with with reinforced concentration limits
reinforced limits considering the might also bring concerns if the
specificities of tokens where selection of the deposit taking
28
deposits are expected to be a institutions is based on other criteria

material component of the (like higher remuneration to
reserve of assets. Stricter limits compensate higher related
envisaged are considered for the operational costs) than the pure
cases of smaller banks receiving optimisation of their
deposits due to potential higher creditworthiness and liquidity
challenges to access additional soundness.
liquidity resources if needed
under stress (e.g. repo markets or
whole sale markets in general) to
mitigate any challenge around the
effectiveness of the deposits.
Diversification is generally accepted

as a sound technique to ensure a
To allow for holding as much good risk management, and mainly in
amount of deposits as the issuer the case of liquidity risk.
may consider necessary with the
Concentrating the deposits in some
same credit institutions since
limited counterparties might have a
these could be the most reliable
very detrimental impact in the
institutions among the available
financial stability in case of failure to
ones.
repay in time by the bank.
Policy option B
Deposits with credit institutions are a

material part of the tokens
These restrictions might impact referenced to official currencies and
business opportunities for the ensuring a prompt redemption of
issuer or sources of higher yield. token holders and to safeguard the
robustness of the financial system
and crypto eco-systems are a priority.
15.The EBA has opted for option A. The EBA finds the implementation of concentration limits by
deposit counterparties crucial. The EBA considers that ensuring prompt redemption of tokens is
key to protect holders’ rights as well as to avoid any risk to expand concerns on the financial
system and crypto ecosystems, particularly considering the strong interconnectedness between
them. The UCITs framework envisages that the deposits with the same bank shall not be more
than 20% of the UCITs assets. The EBA sets the concentration limit by deposit counterparty at
10% of the reserve of assets of the issuer of the tokens, taking into account the specificities and
risks inherent to crypto activities, and at 5% if the bank receiving the deposit is not a large
29
institution. At the same time the EBA considers that the deposits with the same credit institution
should not exceed 2.5% of the total balance sheet of the credit institution taking the deposits.
5.1.5 Mandatory overcollateralisation
d. Overcollateralisation – risks covered
16.Overcollateralisation seeks to mainly cover the market risk of the reserve of assets, rather than
via haircuts on the wide definition of the specified highly liquid financial instruments, and mainly
differences in the market value volatility between the reserve of assets and the assets
referenced to ensure the effectiveness of the reserve assets to meet any redemption request
by token holders at any time included under stress. Overcollateralisation also mitigates the risk
of a potential de-pegging where the parity in tokens referenced to official currencies might be
lost because of some reputational, solvency or other related reasons that result in the market
value of the token be below parity potentially triggering massive redemption request with
subsequent damaging consequences to the issuer and the system if redemption cannot be met
in time in a proper manner.
e. Overcollateralisation - calibration
17.Article 36(4) MiCAR mandates the EBA to develop draft RTS further specifying the liquidity
requirements of the reserve of assets for which the EBA shall take into account the size,
complexity and nature of the reserve of assets and of the asset-referenced token itself. In
particular the mandate refers to the establishment of overall techniques for liquidity
management. The EBA proposed to include a minimum mandatory overcollateralisation in the
context of the techniques for liquidity management of the reserve of assets. Article 36(7)
envisages that the aggregate value of the reserve of assets shall be at least equal to the
aggregate value of the assets referenced, thus recognizing the possibility of
overcollateralisation.
18.The EBA is working on two different approaches or policy options:
a. Policy option 1, where the calibration of the mandatory overcollateralisation builds

on a historical look back approach whose methodology is established in the RTS
and to be applied by the issuer.
b. Policy option 2, where the RTS would provide a specific quantitative calibration of
the mandatory overcollateralisation.
30
Policy option 1 – Historical look back approach (HLBA)
19.A dedicated article in the RTS would establish the methodology to be applied by the issuer. The
target is that the market value of the reserve of assets is always at least sufficient to cover the
liabilities against token holders considering the highest positive difference between the market
value of such liabilities (market value of assets referenced) and the market value of the reserve
of assets any day over the previous 5 years. Overcollateralisation ultimately targets to cover
differences in the market value changes of the assets referenced with respect to the market
value changes of the reserve of assets taking into account hedging derivatives.
20.A daily calculation responds to the required daily computation and compliance with minimum
reserve of assets.
21.The consideration of 5 years seems consistent and justified with the observed tendency of larger
changes in the market value of the more volatile assets referenced like gold, for instance.
22.We see the largest increase in the market dollar value of gold between 2007 and 2012/2013 and
between 2018-2019 and 2023. If unhedged and without over-collateralisation such increases
would pose a risk to the viability of the token.
23.This approach would be implemented by the issuer of the token and therefore would take into
account directly the type of token, reserve of assets, size and complexity as indicated in the
mandate to the EBA.
24.The following section shows an impact assessment of this HLBA to estimate the effort that
issuers might need to make to cover over-collateralisation on the basis of some theoretical and
extreme cases. This effort seems to be manageable.
31
Impact assessment of Policy option 1 (HLBA)
25.The table below summarizes the results from an exercise simulating the overcollateralisation
rules proposed above, using 9 different scenarios (based on 5 theoretical tokens): four with ARTs
referencing official currencies (they intend to replicate the most volatile options with the
minimum required deposits and the maximum amount of covered bonds allowed), and five with
an ART referencing gold (with different shares of gold in the reserve of assets).
26.The following tokens where considered:14
a. Significant EMT referencing EUR, backed by EUR denominated deposits (60%),

sovereign bonds (5%), and covered bonds (35%)
b. Non-significant EMT referencing EUR, backed by EUR denominated deposits (30%),

sovereign bonds (35%), and covered bonds (35%)
c. Gold referencing token, backed by 50% gold reserves, 50% sovereign bonds (in USD
to match the currency of gold pricing)
d. Gold referencing token, backed by 70% gold reserves, 30% sovereign bonds (in USD
to match the currency of gold pricing)
e. Gold referencing token, backed by 100% gold reserves
27.This simulation takes into account the changes observed in the market value of different assets
referenced and reserve of assets. It should be noted that the outcome should be read without
taking into account hedging derivatives that issuers might have in place to mitigate differences
in the volatilities between them.
28.It is assumed that all the abovementioned tokens were issued on 30/06/2018. The required
overcollateralization is calculated in absolute terms as the maximum difference between the
price of the reference assets and the price of the original reserve of assets, which on 30/06/2018
match and diverge thereafter. It is then expressed in percentage relative to the value of
reference assets (as shown in the Table below column 5). For all the scenarios (except one – the
case of the gold backed token) the difference in value between reference and reserve of assets
was calculated based on 1 day and based on 5-day difference (column 4), making a total of 9
scenarios. In the latter case, the difference is measured as the differences between the
maximum value of reference assets within a 5 working days range, and the minimum value of
the reserve of assets within the same 5 days range (expressed as a share of the maximum value
of reference assets within the 5 working days range).
14
Covered bond prices are based on iBoxx € Covered index; Eurozone sovereign bond prices are based on iBoxx €
Eurozone 1-3 index (which includes sovereign bonds with a maturity between 1 and 3 years); Treasury bills prices are
based on the Merrill Lynch 1 Year T-Bill Note Index. Due to data availability, the maturity of Eurozone sovereign bnds
index and that of the US T-bills are not exactly matched to ensure comparability, but where chosen in such as way that
their maturity is as close as possible.
32
29.The daily additional reserves (column 6) refer only to the top up required in order to fulfill the
requirements, considering that the reserves from the previous day already include
overcollateralisation.
Table 1: Summary results
Daily required OC (based

Time range for on maximum difference
calculating the Daily additional reserves
over past 5 years) as
Reference difference in required (from date of
Token (1) Reserves (3) percentage of reference
assets (2) value of issue) (6)
asset value (from date of
reference vs issue) (5)
reserve assets (4)
Average Min Max Average Min Max
Significant 100% currency deposits 1 day 1.7% 0.2% 6.3% 0.0% -0.4% 0.7%
EMT official (60%), sovereign
currency bonds (5%), and 5 day 1.7% 0.2% 6.3% 0.0% -0.4% 0.7%
(EUR) covered bonds
(35%)
Non- 100% currency deposits 1 day 3.3% 0.3% 10.3% 0.0% -0.7% 0.9%
significant official (30%), sovereign
EMT currency bonds (35%), and 5 day 3.3% 0.3% 10.3% 0.0% -0.7% 0.9%
(EUR) covered bonds
(35%)
Gold backed 100% gold 50% gold, 50% 1 day 14.0% 7.8% 17.6% 0.0% -2.8% 2.2%
token (50% sovereign bonds 5 day 17.0% 9.6% 21.3% 0.0% -2.3% 2.3%
gold reserves) (USD)
Gold backed 100% gold 70% gold, 30% 1 day 8.4% 4.7% 10.6% 0.0% -1.5% 1.2%
token (70% sovereign bonds
5 day 12.8% 7.9% 15.7% 0.0% -1.2% 1.5%
gold reserves) (USD)
Gold backed 100% gold 100% gold NA 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
token (100%
gold reserves)
Note: Covered bond prices are based on iBoxx € Covered index; Eurozone sovereign bond prices are based on iBoxx €
Eurozone 1-3 index (which includes sovereign bonds with a maturity between 1 and 3 years); Treasury bills prices are
based on the Merrill Lynch 1 Year T-Bill Note Index (S&P Global).
30.The results show that for significant ARTs the overcollateralisation required (based on the
maximum difference between prices of reference assets and reserve assets over the past 5
years) will range between 0.2% and 6.3% of the value of reference assets (Chart 1). Since the
reserves will generally be overcollateralised most of the times, the issuers will only need to top
up the reserves with the difference. For the case of significant ART, this difference will range
between -0.4% (i.e. a decrease in required reserves) and 0.7% of the value of reference assets
(Chart 2).
31.For non-significant ARTs, where the currency deposits are 30% (minimum required based on
(MiCAR), the maximum overcollateralisation and additional reserves required increase by a
third.
32.It is to be noted that in both cases the additional required reserves are zero on average, as it
takes into account the prices changes that lead to a decrease in reserve requirements also.
33
Moreover, there is no material difference in the overcollateralisation required, whether the time
range for calculating the difference between the value of reference and reserve assets is 1 day
or 5 days.
Figure 1. Signifcant ARTs: Overcollateralisation based on maximum price difference of past 5

years, with difference calculated over 1 day (as percentage of reference asset value)
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
29/06/2018 29/06/2019 29/06/2020 29/06/2021 29/06/2022 29/06/2023
34
Figure 2. Signficant ARTs: Additional daily reserves required with difference calculated over 1 day
(as percentage of reference asset value)
0.80%
0.60%
0.40%
0.20%
0.00%
29/06/2018 29/06/2019 29/06/2020 29/06/2021 29/06/2022 29/06/2023
-0.20%
-0.40%
-0.60%
33.In the case of gold tokens backed by a combination of gold and sovereign bond reserves, the
ranges increase, as expected, with highest overcollateralisation requirements shown in the case
of the token with lower share of gold in the reserve of assets. The overcollateralisation reaches
11% and 18% of reference assets for the gold token backed by 70% and 50% of gold respectively,
where the difference in values of reference and reserve assets is based on a 1 day window. If
the difference is based on a 5-day window, the maximum overcollateralization increases to 16%
and 21% respectively. The daily changes in reserves are higher than for ARTs backed by official
currencies. However, in the case of commodity tokens it has to be noted that these differences
do not always need to materialize in an actual change of reserves, as some of it already comes
from the change in the daily volatility in value of the reserve assets. A particular case in this
regard is the case of a gold token backed by 100% gold reserves (last scenario).15 In this case the
overcollateralisation is 0% and no additional changes to reserves are required, as the value of
the reserve of assets follows exactly the value of the reference assets.
34.The graphs of the evolution of over-collateralization and additional daily reserves required for
gold tokens backed by 50% gold are shown in Figure 3 and 4.
15
So far , the major gold tokens are backed 100% by gold reserves (Tether gold and Paxos gold)
35
Figure 3. Gold tokens (50% backed by sovereign bonds): Overcollateralisation based on

maximum price difference of past 5 years, 5 days window (as percentage of reference asset
value)
36
Figure 4. Gold tokens (50% backed by sovereign bonds): Additional daily reserves required (as
percentage of reference asset value)
f. Policy option 2 – specific calibration in the RTS
Tokens referenced to official currencies
35.Features:
a. Reserve of assets: assets received and retained (e.g. deposits with banks (min 30%
or 60%)), sovereigns and covered bonds (max. 35%)
b. Assets referenced: official currencies
36.In these tokens the volatility comes from covered bonds mainly. These are subject to a 7%
haircut. Covered bonds are capped at 35% of the reserve of assets. Deposits are at least 30% (or
60% if the token is significant).
37.In addition, de-pegging risk should be considered for which the volatility of the market value of
tokens referenced to official currencies versus the asset referenced (official currency itself)
should be taken into account.
38.All in all a rough approximation taking into account these elements might lead to an expected
overcollateralisation around the levels of between 3% - 5%.
37
Tokens referenced to other than official currencies.
39. Features:
a. Reserve of assets: assets received and retained (e.g. gold, deposits with banks),
sovereigns and covered bonds (max. 35%), assets referenced.
b. Assets referenced: any financial instrument or combination of them, index

references, commodities…
40.If the reserve of assets fully replicates the assets referenced, the minimum over-collateralisation
for tokens referenced to official currencies might be simply kept for the cases where this replica
is synthetic to cover the tracking error.
41.If there is no replication, the volatility of commodities (probably the most volatile asset
referenced) would need to be assessed and estimated based on the one proposed for tokens
referenced to official currency. For example, if the volatility of commodities is two times the
volatility of securities in EMTs (mainly covered bonds) then we might go for an over-
collateralisation of between around 6% - 10% (if a 3% - 5% is used for EMTs).
5.1.6 Pros and cons of Policy option 1 versus Policy option 2
PROS CONS
Full harmonisation in the Might not be based on stress

determination of the times. However this would be
approach to follow by all. A complemented by the
HLBA is also used to LCR liquidity stress testing which is
additional outflows from based on expectations for
derivatives. stress scenarios.
There might be some risk of

Policy option 1 (HLBA)
Takes into account optimisation. However, the
specificities based on token approach is quite specific and
type, assets referenced, easy to review by supervisors.
complexity, size. De-pegging risk is captured in
the liquidity stress testing.
Subject to review on an
Risk of procyclicality.
ongoing basis
Application subject to Potential risk of a non-

maximum harmonisation accurate calibration (not too
38
since a specific number much data of experience) but

applies. more based on
approximations.
Specificities are not

Covers all risks described
Policy option 2 (specific considered but for some
including de-pegging risk with
calibration) approximations by token type
some add-on.
and assets referenced
Lower operational burden for Calibration updates subject to

the issuer regulatory reviews.
42.The EBA has opted for policy option 1 with 5 working day windows during the previous 5 years
as observation periods of the differences between the market value of the reserve of assets and
the assets referenced. 5 working day windows align to maximum maturities for readily available
liquidity in MiCAR and do not seem more operational burdensome than 1 day windows since
the necessary data base is the same. This approach ensure an ongoing analysis of the necessary
reserve of assets to cover any redemption request under stress. The approach takes into account
all specificities of each token, asset referenced, complexity and size. Procyclicality is controlled
since the overcollateralisation is defined in relative terms to be compared over time.
39

Question 1. Do respondents have any comment about the calibration of the percentages
of reserve assets with specific maximum maturities as suggested in Article 1
and Article 2 of the draft RTS?
Question 2. Do respondents consider that the requirements in Article 1 and Article 2

related to the 1 and 5 working days maximum maturity could create
excessive pressure in the repo market, taking into account the minimum
required amount of deposits in credit institutions in the case of tokens
referenced to official currencies?
Question 3. Do respondents have any comment on the proposed approach in Article 3

of the draft RTS to not increase the minimum amount of deposits from 30%
(or 60% if the token is significant) of the asset referenced in each official
currency?
Question 4. Do respondents have any comment with the definition of the requirement
of a minimum liquidity soundness and creditworthiness in the deposits with
credit institutions as proposed in Article 4 of the draft RTS?
Question 5. Do respondents have any comment about the definition of the requirement
of a maximum concentration limit of deposits with credit institutions by
counterparty in Article 5 of these draft RTS? And about the definition of the
general limit considering, in addition to deposit with a bank, also the
covered bonds issued by and unmargined OTC derivatives with the same
bank counterparty?
Question 6. Do respondents have any concern about compliance with these

concentration limits in Article 5, considering in particular paragraph 14 of
the cost/benefit analysis in relation to the potential operational burden and
risk of a wrong direction diversification, linked to the minimum required
liquidity soundness and creditworthiness of deposits with banks, and taking
into account the minimum amount required of deposits with credit
institutions by MiCAR for tokens referenced to official currencies?
Question 7. Do respondents have any comment about the definition of the mandatory
over-collateralisation in Article 6 of these draft RTS and the rationale for it?
Do respondents find it challenging from an operational perspective, in
particular with respect to envisaging 5 days windows rather than 1 day
windows for observation periods of the market value of the assets
referenced versus the reserve of assets and over the previous 5 years?
Please elaborate your response with detailed reasoning.
Question 8. Do respondent think that any provision in the draft RTS is confusing and that
some clarification would be necessary?
40
EBA/CP/2023/24
08 NOVEMBER 2023
Consultation Paper

to specify the highly liquid financial instruments with minimal
market risk, credit risk and concentration risk under Article 38(5) of
Regulation (EU) 2023/1114
CONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS TO SPECIFY THE HIGHLY LIQUID
FINANCIAL INSTRUMENTS WITH MINIMAL MARKET RISK, CREDIT RISK AND CONCENTRATION RISK UNDER
ARTICLE 38(5) OF REGULATION (EU) 2023/1114
Contents
3.2 Draft regulatory technical standards specifying the highly liquid financial instruments 8
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European Ombudsman.
Data protection
website.
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Article 38(1) of Regulation (EU) 2023/1114 requires that issuers of asset-referenced tokens,
irrespective of whether they are significant or not, that decide to invest the proceeds they receive
from the issuance of the tokens and form part of the reserve of assets, shall do it in financial
instruments that are highly liquid and with minimal market risk, credit risk and concentration risk.
These highly liquid financial instruments shall be capable of being liquidated rapidly with minimal
adverse price effect since they need to be effective to be able to meet in a prompt manner any
redemption request stemming from the token holders at any time including under stress.
The requirement of a reserve of assets applies as well to electronic money (e-money) institutions
issuing e-money tokens that are significant by virtue of Article 58(1) of Regulation (EU) 2023/1114
and can be expanded to e-money institutions issuing e-money tokens that are not significant if the
competent authority of the home Member State requires it so following Article 58(2) of Regulation
(EU) 2023/1114.
Article 38(5) of Regulation (EU) 2023/1114 to specify the financial instruments that can be
considered highly liquid and bearing minimal market risk, credit risk and concentration risk. With
this the identification of eligible investments of the reserve of assets becomes harmonized and
transparent.
In the development of the mandate the EBA is required to take into account the various types of
assets that can be referenced by an asset-referenced token and the correlation between the asset
referenced by the asset-referenced token and the highly liquid financial instruments that the issuer
might invest in, in order to mitigate different market value volatilities between them to ensure that
the amount of the reserve of assets can meet at all times the market value of the asset referenced
for any redemption request that can arise. Furthermore, in the specification of highly liquid financial
instruments, the EBA needs to take into account the LCR framework and the UCITs framework, the
latter particularly to determine concentration limits in the investment of highly liquid financial
instruments by issuer, which is also part of the mandate.
Next steps
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1. Article 36(1) of Regulation (EU) 1114/2023 on markets in crypto-assets (Regulation (EU)
2023/1114) requires issuers of asset-referenced tokens (ARTs), whether they are significant
ARTs or not, to constitute and maintain a reserve of assets at all times to cover their liabilities
against the holders of their issued ARTs matching the risks reflected within said liabilities. Article
58(1) extends that requirement to e-money institutions issuing significant e-money tokens
(EMTs). Furthermore, Article 58(2) envisages the possibility that competent authorities may
impose that requirement as well to e-money institutions issuing EMTs that are not significant.
2. The reserve of assets shall be composed of the assets that the issuer receives and keeps when
issuing the tokens (e.g. deposits with credit institutions, commodities, financial instruments…)
and by the highly liquid financial instruments the issuer may invest in.
3. In the case of ARTs referencing one or more official currencies, the reserve of assets shall be
composed of deposits in credit institutions by at least 30%1 (or 60%2 if required by the relevant
competent authority) of the amount of the assets referenced in each official currency for issuers
of ARTs that are not significant, or 60%3 in the case of issuers of significant ARTs.
4. The minimum amount of deposits in credit institutions of 60% of the amount referenced is also
required in the case of e-money institutions issuing EMTs that are significant 4 . E-money
institutions issuing EMTs that are not significant can be required by their competent authority
to have a minimum of 30%5 or 60%6 in the form of deposits in credit institutions.
5. This minimum required amounts of deposit in credit institutions within the reserve of assets
does not apply in the case of ARTs referencing assets other than official currencies, for example
commodities or financial instruments. However, in the case of these ARTs, funds received by the
issuer when issuing the token may be kept as deposits in credit institutions on a voluntary basis
within the reserve of assets. Indeed Article 38(1) envisages that ARTs issuers may invest a part
of the reserve of assets in highly liquid financial instruments but are not obliged to do it and,
therefore, have the possibility to keep the funds received from the issuance of the ARTs.
6. In the case of ARTs referencing a combination of official currencies with assets other than official
currencies the minimum required amount of deposits in credit institutions within the reserve of
assets applies for the part of amount referencing official currencies only.
1
Article 36(4)(d) MiCAR
2
Article 35(4) MiCAR in conjunction with Article 45(7) MiCAR
3
Article 45(7) MiCAR
4
Article 58(1) MiCAR in conjunction with Article 45(7) MiCAR
5
Article 58(2) MiCAR in conjunction with Articles 58(1) and 36(4)(d) MiCAR
6
Article 58(2) MiCAR in conjunction with Articles 58(1) and 45(7) MiCAR
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7. Article 38(1) refers to the part of the reserve of assets that issuers invest in. This part shall be
composed of highly liquid financial instruments with minimal market risk, credit risk and
concentration risk that can be liquidated rapidly with minimal adverse price effect.
8. The EBA is mandated under Article 38(5), in cooperation with ESMA and the ECB, to develop
draft regulatory technical standards (RTS) specifying those highly liquid financial instruments
and concentration limits, for which the EBA shall take into account (i) the various types of assets
that can be referenced by an asset-referenced token; (ii) the correlation between the assets
referenced by the asset-referenced token and the highly liquid financial instruments the issuers
may invest in; (iii) the definition and specifications of the liquidity coverage requirement; (iv)
concentration limits in the UCITs framework for the purposes of preventing the issuer from
investing in highly liquid financial instruments issued by a single entity more than a certain
percentage of the reserve of assets and (v) constraints on concentration of tokens by custodians
belonging to the same group.
9. For the development of these RTS, the EBA builds on the 2022 Basel standards on the prudential
treatment of crypto assets exposures as well as on the new international regulatory
developments, as well as the UCITs Directive 2009/65 and the Commission Delegated Regulation
(EU) 2015/61 (LCR Delegated Regulation) as envisaged in Regulation (EU) 2023/1114.
10.The consultation of these RTS on the definition of the reserve of assets under Article 38(5)
Regulation (EU) 2023/1114 is being undertaken in parallel to other two consultations on liquidity
related aspects of issuers of tokens, i.e. the RTS for the definition of liquidity requirements
envisaged in Article 36(4) Regulation (EU) 2023/1114 and the RTS for the specification of the
content of the liquidity management policy and procedures under Article 45(7)(b) Regulation
(EU) 2023/1114.
3.1 Liquidity related risks of issuers of ARTs and EMTs

11.As established in Articles 49 and 39, EMTs and ARTs holders can request redemption of the
tokens at any time, including stress scenarios, against the reserve assets. In the case of EMTs,
the redemption shall be at par value by paying in funds the monetary value of the EMT. In the
case of ARTs, redemption shall be made by the issuer either by paying an amount in funds
equivalent to the market value of the assets referenced or by delivering the assets referenced
by the ARTs. Where issuers of ARTs accepted a payment in funds in an official currency when
selling the token, then they shall always provide the option to redeem the token in funds
denominated in the same official currency.
12.The said ARTs and EMTs issuers are thus required to maintain a pool of assets by which the
tokens maintain a stable value, relative to the asset or assets they reference.
13.Article 36(1)(b) clarifies that the composition of the reserve of assets shall aim to cover the
liquidity risks associated to the permanent redemption rights of the token holders.
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3.1.1 Liquidity risks related to the reserve assets. Redemption of tokens and
financial stability.
14.The composition and management of the reserve of assets are of key importance to ensure that
the reserve assets can be liquidated rapidly at or close to prevailing market prices.
15.Obstacles to a prompt access to the reserve of assets, like deterioration in the solvency profile
of the banks holding issuers’ deposits, or negative volatility of the highly liquid financial
instruments in the reserve of assets, challenge the stability of the market value of the tokens
with subsequent potential large-scale redemption requests. This in turn may result in “fire sales”
of reserve assets challenging the stabilization mechanism and causing losses that could make
the reserve assets insufficient relative to the liabilities and even deteriorate the own funds of
the issuers.
16.Massive fire sales could negatively impact the markets in which the high liquid financial
instruments are traded. A large redemption request of tokens, in particular in the case of market
wide stress events, with a high concentration of the reserve assets as deposits with banks, could
prompt a massive run of these deposits causing a deterioration of the liquidity profile of the
affected banks and a loss of confidence in the general banking system.
17.Furthermore, such situation could impair user confidence in the resilience of the token as a
payment mechanism.
18.The ability to sell reserve assets in large volume at (or close to) prevailing market prices would
depend on the market depth firstly and then on quality, liquidity and concentration of the
reserve assets. The degree of transparency as to the nature and liquidity of these reserve assets
might also affect confidence in the token.
3.1.2 Liquidity risks related to the DLT infrastructure
19.DLT failure, including issues regarding the validation of users’ ownership and transfer of tokens,
or the lack of network capacity to validate large volumes of transactions might cause users’ loss
of confidence, and trigger redemption requests. Disruption to the mechanism that links the
value of the token and the value of its reserves, for example a cyber-incident, entailing a value
mismatch between reserve assets and crypto assets could also be a source of liquidity risk.
3.1.3 Custody of the reserve assets
20.Potential uncertainties regarding the terms under which the assets can be transferred to the
token holders/issuers or liquidated on the market, legal impediments (e.g. in case of regulators
take-over of the custodian) or conflict of interest between the custodian-issuer versus holder of
the token (if the valuation of the reserve assets does not reflect its market value) can be a source
of liquidity risks for the tokens issuers.
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3.2 Draft regulatory technical standards specifying the highly

liquid financial instruments
21.The EBA is mandated to take into account the following specific aspects for the definition of
highly liquid financial instruments in the reserve of assets.
3.2.1 Definition of liquid assets in the LCR vs Definition of highly liquid financial
instruments in the reserve of assets
22.Article 38(5) refers to ‘financial instruments’ that can be highly liquid. The EBA follows the legal
definition of ‘financial instruments’. Directive 2014/65/EU on markets in financial instruments
(MIFID II) refers in Section C of Annex I to ‘Financial instruments’ including basically transferable
securities, money market instruments, units in collective investment undertakings (CIUs) and
derivatives. Similarly point 50 of Article 4 of the CRR defines ‘financial instrument’ as the
following mainly: a cash instrument or a primary financial instrument. Furthermore, those
established as such in MIFID, contracts that give rise to both a financial asset of one party and a
financial liability or equity instrument of another party and derivatives, as long as their value is
derived from the price of an underlying financial instrument or another underlying item, a rate,
or an index.
23.The EBA takes into account the definition of financial instrument in the specification of highly
liquid financial instruments.
24.When specifying the highly liquid financial instruments, as mandated in Article 38(5), the EBA
shall take into account “(c) the liquidity coverage requirement as referred to in Article 412 of
Regulation (EU) No 575/2013 and as further specified in Commission Delegated Regulation (EU)
2015/61”.
25.The Commission Delegated Regulation (EU) 2015/61 (LCR DR) provides definitional criteria to
identify specific categories of assets that could be considered liquid assets in the liquidity
coverage ratio if they meet specific general and operational requirements. Liquid assets in the
LCR are ready to be liquidated immediately at any point in time, including under stress scenarios,
and with no or low loss of market value. Their characteristics serve as the basis for the definition
of the eligible highly liquid financial instruments in the issuer’s reserve assets. Highly liquid
financial instruments in the reserve assets aim to meet similar targets under similar conditions
and scenarios, i.e. to cover payment of obligations in a prompt manner in the short term,
including stress scenarios, with no or low loss of value.
26.The EBA considers that highly liquid financial instruments in the reserve of assets need to overall
meet the general and operational requirements as envisaged in Articles 7 and 8 of LCR DR with
some specificities.
27.In the cases of EMTs as well as in the case of ARTs where the assets referenced are official
currencies, highly liquid financial instruments in the reserve of assets are capped due to the
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minimum required amount of reserve of assets to be held as deposits with banks, as opposed to
the uncapped amount of sovereign bonds in the LCR liquidity buffer. Due to this implicit cap, the
EBA considers that in these cases sovereign bonds should not be exempted from the
requirements to have a market value that is public or easy to determine, to be listed on a
recognized exchange or tradable on generally accepted repurchase markets, to be diversified
and subject to a minimum monetisation on an annual basis. Due to the limitation already
imposed on highly liquid financial instruments, the definition of eligible sovereign exposures
here should be reinforced, and thus not benefit from the exemptions in the LCR. In the LCR the
uncapped amount might cover concerns about compliance with those requirements.
28.Full currency matching between the reserve of assets and the assets referenced is referred to
by Regulation (EU) 2023/1114. Articles 39(2) and 49(4) Regulation (EU) 2023/1114 establish that
issuers of ARTs shall always provide the possibility to redeem the token in funds denominated
in the same official currency as the one in which they accepted the payment when selling the
token and where issuers of EMTs shall redeem the token at par value paying in funds the
monetary value of the EMT. This general one to one currency matching between the reserve of
assets and the liabilities against token holders is complemented by a second layer currency
consistency requirements between the bank deposits in the reserve of assets and the assets
referenced in Articles 36(4d) and 45(7)(b). Therefore, no reference to operational requirements
in the LCR related to currency consistency needs to be envisaged for the highly liquid financial
instruments in the reserve of assets.
29. Article 38(5) requires highly liquid financial instruments to have minimal market risk, credit risk
and concentration risk. Haircuts reflect credit and liquidity risk of liquid assets in the LCR as
illustrated by Article 418(1) CRR. The Basel standards on the LCR refers to the haircuts to
compensate for market, credit and liquidity risk. Caps on specific liquid assets in the LCR liquidity
buffer represent limits for assets of lower quality. Considering the required minimal credit risk
and market risk, minimum volatility and maximum price stability, including under stress, the EBA
considers that the highest quality liquid assets in the LCR, i.e., 0% haircut and uncapped level 1
assets, seem to be the most appropriate category of assets to be included as eligible highly liquid
financial instruments only. This basically includes financial instruments in the form of sovereign
bonds, regional government/local authorities/PSE bonds that are assimilated to sovereign
bonds, central bank assets, promotional bonds and bonds issued by multilateral development
banks and by other specific international organizations. Minimal concentration risk is addressed
in the mandate to set concentration limits by issuer.
30.In addition to this the EBA considers that level 1 extremely high-quality covered bonds in the
LCR should be included as highly liquid financial instruments in the reserve of assets, capped at
35% of the reserve of assets (please see section 5.1 of this consultation paper on the impact
assessment). This is in order to ensure that issuers of tokens referenced to official currencies
other than EUR can meet the minimum required amount of reserve of assets considering their
limited access to only one issuer of level 1 government bonds in the LCR as well as taking into
account the required currency matching between the reserve of assets and the assets
referenced and concentration limits by issuer following the mandate to the EBA.
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31.As established in paragraph 2 of Article 38 units in UCITs are considered highly liquid financial
instruments if the UCIT invests solely in highly liquid financial instruments as defined in these
RTS and the issuer of the token still ensures that the concentration risk of the reserve of assets
is minimal.
a. Unwinding collateral swaps, repos and reverse repos in the definition of highly
liquid financial instruments
32.Before the application of the unwinding mechanism, the issuer of tokens should generally reflect
the following items in the reserve of assets (mainly as long as related to securities financing
transactions):
- The highly liquid financial instruments that are expected to be available at any time,
including on day zero. This excludes those pledged and encumbered in repos or
collateral swaps. This is consistent with the LCR treatment of HQLA, that should be
available at any time during the 30-day time horizon.
- The deposits with banks that can be used. This is consistent with the LCR treatment
of inflows/outflows from deposits during the 30-day time horizon.
33.Unwinding short-term collateral swaps, repos and reverse repos seeks to cover the risk of
computing in the banks’ LCR or in the reserve of assets of tokens’ issuers collateral received
under securities financing transactions that will be paid out in the short term. It ultimately
targets to avoid any overestimate of the LCR or of the reserve of assets.
34.The unwinding mechanism in the LCR consists of considering the cash and collateral in/outflows
upon maturity of the transactions in the short term for the purposes of computing the HQLA
caps only. Thus, level 1 HQLA available at present should not be impacted in theory. However,
in the LCR inflows/outflows apply and take into account the flows of cash/collateral of these
transactions in the short term.
35.The unwinding mechanism proposed in these draft RTS is for the purposes of both the
computation of the reserve of assets itself and for the caps. This is in order to take into account
the risk that is covered in the LCR by inflows/outflows. The reserve assets, including
cash/deposits or highly liquid financial instruments, count only as long as available at the end of
the short-term time horizon considered, on which the unwinding applies. Thus, it takes into
account the resources available at inception plus the incoming/outcoming of cash/collateral
during the time horizon. In summary the unwinding of securities financing transactions in the
reserve of assets includes the impact of the inflows/outflows recognised in the LCR.
36.In summary the following adjustments need to be considered in the unwinding of securities
financing transactions for the computation of the reserve of assets of the issuer of tokens. To be
noted that haircuts do not apply here (please see paragraph 57).
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- Reverse repos - collateral eligible in the reserve of assets: unwinding = - market

value of collateral + cash leg
- Reverse repos - collateral is not eligible in the reserve of assets: unwinding = + cash
leg
- Repos – collateral is eligible in the reserve of assets: unwinding = + market value

of collateral – cash leg
- Repos – collateral is not eligible in the reserve of assets: unwinding = - cash leg
- Collateral swap – collateral received and lent are eligible in the reserve of assets =
+ market value of collateral to be received – market value of collateral to be paid
out
- Collateral swap – collateral received and lent are not eligible in the reserve of assets
= no unwinding
- Collateral swap – collateral received is eligible in the reserve of assets and lent is
not eligible in the reserve of assets = - market value of collateral to be paid out
- Collateral swap – collateral received is not eligible in the reserve of assets and lent
is eligible in the reserve of assets = + market value of collateral to be received
Time horizon
37.The EBA has assessed the determination of the time horizon for the unwinding. Short term
definition should be in line with Regulation (EU) 2023/1114. It is, thus, understood the time by
which the liquid assets should be available.
38.Article 36(a) and (b) Regulation (EU) 2023/1114 focuses on the liquidity resources up to the
following 5 working days as “survival period” like for immediate effectiveness of the reserve of
assets. The assumption is that the liquidity stress here might be expected to happen much more
quickly and profoundly than in the banking business.
39.There are some drawbacks in considering a time horizon larger than 5 days for the unwinding.
Liquid assets that would be available during the following 5 days, that Regulation (EU)
2023/1114 seems to consider in the reserve of assets, would be underestimated. For example
this is the case of 15 days collateral swaps where liquid assets have been received in exchange
of non-liquid assets. At the same time, there is an overestimation of the liquidity resources only
available beyond 5 working days if for example a reverse repo maturing in 15 days collateralised
by non-liquid assets is included.
Other aspects
40.The amount of the reserve of assets, after unwinding the relevant securities financing
transactions, should be considered for the purposes of the 35% cap in covered bonds (please
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see section 5.1 of this consultation paper on the impact assessment), the minimum percentages
of the reserve of assets maturing up to 1 or 5 working days (please see the draft RTS to further
specify the liquidity requirements of the reserve of assets under Article 36(4) of Regulation (EU)
2023/1114) and for the concentration limits of highly liquid financial instruments by issuer
(please see section 3.2.2 of this consultation paper) and of deposits by counterparty (please see
the draft RTS to further specify the liquidity requirements of the reserve of assets under Article
36(4) of Regulation (EU) 2023/1114).
3.2.2 Concentration limits of investments by UCITs (undertakings for collective

investment in transferable securities)
41.When specifying the highly liquid financial instruments, as mandated in point (d) of Article 38(5),
the EBA shall take into account “(i) constraints on concentration preventing the issuer from
investing more than a certain percentage of reserve assets in highly liquid financial instruments
with minimal market risk, credit risk and concentration risk issued by a single entity.” For these
purposes “EBA shall devise suitable limits to determine concentration requirements. Those limits
shall take into account, amongst others, the relevant thresholds laid down in Article 52 of
Directive 2009/65/EC”.
42.The EBA takes into account the references in Regulation (EU) 2023/1114 to UCITs and the
similarities in risks and activities between them and ART/EMT issuers and considers the
concentration limits that should apply to highly liquid financial instruments in the form of
securities in the reserve of assets as concentration requirements by issuer.
43.The UCITs framework envisages a general concentration limit of 5% of their investments for
securities issued by the same issuer. This limit is envisaged to be able to be increased up to 25%,
in the case of covered bonds, and to 35% for the cases of, generally, government bonds. For
exposures to OTC derivatives, the UCITs framework envisages a concentration limit with the
same counterpart of 10%, if it is a credit institution, or 5% otherwise.
44.The EBA is proposing the 35% limit for government bonds and a 10% limit for covered bonds.
This is in order to ensure that issuers of tokens referenced to assets denominated in currencies
other than EUR can meet the minimum necessary reserve of assets considering generally a single
issuer of government bonds in the same currency, full currency matching requirement between
reserve of assets and assets referenced and, in some case, potentially a limited number of
covered bonds issuers.
45.A look through approach is envisaged for the assessment of compliance with the concentration
limit when it comes to units in UCITs or in CIUs as highly liquid financial instruments.
46.The EBA proposes also the inclusion of the concentration limit by counterparty in the OTC
derivatives for the unmargined part of them. The margins provided are considered to mitigate
the remaining risk.
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3.2.3 The various types of assets that can be referenced by ARTs and
correlation between the assets referenced by the ARTs and the reserve assets
shall take into account “(a) the various types of assets that can be referenced by an asset-
referenced token;”. Furthermore, the EBA shall take into account “(b) the correlation between
those assets referenced by the asset-referenced token and the highly liquid financial instruments
the issuers may invest in;”.
48.REGULATION (EU) 2023/1114 refers to ‘electronic money token’ or ‘e-money token’ as a type of
crypto-asset that purports to maintain a stable value by referencing the value of one official
currency.
49.REGULATION (EU) 2023/1114 refers to ‘asset-referenced tokens’ aiming at maintaining a stable

value by referencing any other value or right, or combination thereof, including one or several
official currencies.
50.Regulation (EU) 2023/1114 allows for the widest possible set of types of assets that can be
referenced by ARTs, including commodities, financial instruments or crypto-assets.
51.The market value of the reserve assets held by the issuer needs to fully cover the amount of the
liabilities against the token holders which are pegged to the market value of the assets
referenced.
52.The EBA considers that mitigating the risk of any difference between the volatility of the market
value of the asset referenced and the volatility of the market value of the reserve of assets
should be a key factor in the determination of the composition of the reserve of assets to ensure
that their amount is always at least equal to the amount of the liability towards the token holder.
This is linked to a minimum correlation between the market value of the reserve of assets and
the market value of the assets referenced.
53.In the case of EMTs or ARTs referenced to official currencies, a sufficient correlation between
the reserve assets and assets referenced is reasonably expected since Regulation (EU)
2023/1114 envisages the reserve of assets to be held as bank deposits in the proportion of assets
referenced. The rest of the reserve of assets is proposed to be composed of assets with low
volatility, i.e. 0% LCR haircut liquid assets and level 1 extremely high quality covered bonds.
54.In the case of ARTs referencing assets other than official currencies (e.g. commodities, financial
instruments or crypto-assets), the EBA considers that by allowing these referenced assets and
derivatives relating to them, covering market value changes between the assets referenced and
the reserve assets, as highly liquid financial instruments, a minimum correlation between their
market value and subsequent mitigation of the de-pegging risk is expected to be achieved. This
is in addition to the fact that the issuer may keep the assets received when selling the ARTs (e.g.
commodities) and not invest them in highly liquid financial instruments.
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55.At the same time the EBA understands that introducing volatility in the amount of reserve of
assets via the inclusion of volatile assets in the definition of highly liquid financial instruments
might bring volatility in the market value of the ARTs that might ultimately result in a massive
redemption request. This would lead to liquidity risks for the issuer, bank deposits
counterparties, as well as generally financial markets due to fire sales including the banking
system and crypto-assets markets.
56.Therefore, the EBA proposes the eligibility of the referenced assets, if financial instruments, or
of financial instruments relating to them7 in the definition of highly liquid financial instruments
in the reserve of assets but without setting a minimum or maximum value for it. With this, the
EBA also seeks to ensure a good balance between the Regulation (EU) 2023/1114 expectation
to taken into account for these purposes the definition of liquid assets in the LCR while seeking
a minimum correlation between the reserve assets and the assets referenced. Still, the EBA
expects that the referenced assets that are included in the reserve of assets meet the
operational and general requirement as for liquid assets in the LCR, e.g. unencumbered, readily
available and without any impediments for their liquidation.
57.The EBA proposes to not apply regulatory haircuts to the highly liquid financial instruments for
simplicity reasons and since the risk covered by them is addressed via a minimum
overcollateralisation of the assets referenced as proposed in the draft RTS to further specify the
liquidity requirements of the reserve of assets under Article 36(4) Regulation (EU) 2023/1114.
58.With the inclusion of the referenced assets in the definition of highly liquid financial instruments
within the reserve of assets, the 5% concentration limit by issuer in the UCITs framework should
apply for the cases of those financial instruments in the form of securities.
3.2.4 Concentration limits of ARTs in custody with entities within the same
group
shall take into account “(cd) constraints on concentration, preventing the issuer from holding in
custody more than a certain percentage of crypto-assets or assets with crypto-asset service
providers or credit institutions which belong to the same group, as defined in Article 2, point (11),
of Directive 2013/34/EU of the European Parliament and of the Council or investment firms.”
60.Article 37(1)(e) establishes that concentration in the custodians of reserve assets needs to be
avoided. Recital 55, however, envisages that “However, in certain situations, this might not be
possible due to a lack of suitable alternatives. In such cases, a temporary concentration should
be deemed acceptable.”
It is not part of the EBA mandate to set specific concentration limits on this. However, the EBA
proposes that the liquidity management and procedures in place for token issuers envisage
specific measures to address this concentration risk. The draft RTS on the specification of the
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For instance an ETF/ETN on gold or a derivative contract on another commodity.
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liquidity management policy and procedures in place under Article 45(7)(b), which is in public
consultation in parallel to these draft RTS, recalls these expectations in Regulation (EU)
2023/1114 and addresses this issue.
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ONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS TO SPECIFY THE HIGHLY LIQUID
EN 16
EN
of XXX

Council with regard to regulatory technical standards for specifying the highly liquid
financial instruments with minimal market risk, credit risk and concentration risk
Whereas:
(1) For the purpose of allowing investment in highly liquid financial instruments having
minimal market, credit and concentration risk, as envisaged in Article 38(1) of
Regulation (EU) 2023/1114, level 1 liquid assets subject to 0% haircut according to
Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 9 should be
included as highly liquid financial instruments in the reserve of assets of a token issuer.
(2) In the identification of the highly liquid financial instruments having minimal market,
credit and concentration risk, it is necessary to take in to account the following
requirements set out in Regulation (EU) 2023/1114: (i) the required currency matching
between the denomination of the reserve of assets and the assets-referenced by the
tokens; (ii) a minimum required amount of 30% of deposits with credit institutions,
denominated in the official currency referenced by tokens that are not significant; and
(iii) the concentration limits by issuer referred to in the prudential framework
applicable to undertakings for collective investment in transferable securities
(UCITS). Based on these aspects, it is necessary to include level 1 liquid assets in the
form of extremely high quality covered bonds as referred to in Delegated Regulation
(EU) 2015/61 as highly liquid financial instruments, up to 35% of the value of the
reserve of assets, so as to ensure that the requirements on highly liquid financial
instruments can be met while ensuring that the market, credit and concentration risk
of the reserve of assets remain low.
(3) In the determination of the highly liquid financial instruments, it is necessary to take
into account the expected higher volatility of the assets referenced by the tokens, when
8
OJ L 150, 9.6.2023, p. 40.
9
Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of the
European Parliament and the Council with regard to liquidity coverage requirement for Credit Institutions (OJ L 11,
17.1.2015, p. 1).
EN 17
EN
they are not referenced to official currencies. Therefore, in order to allow maintaining
a higher correlation between the value of the assets referenced and the value of the
reserve of assets, the specific financial instruments referenced by the tokens or
derivatives relating to the assets referenced by the tokens should be included in the
reserve of assets as highly liquid financial instruments. This higher correlation is
necessary to mitigate the potential mismatch in market and credit risk between the
assets referenced and the reserve of assets.
(4) As in the determination of the LCR liquidity buffer in accordance with Delegated
Regulation (EU) 2015/61, an unwinding mechanism for secured funding, secured
lending or collateral swap transactions should be envisaged for the determination of
the amount of the reserve of assets.
(5) Overall, the general and operational eligibility requirements for liquid assets set out in
Delegated Regulation (EU) 2015/61 should apply also for the highly liquid financial
instruments in the reserve of assets. However, some exceptions should be envisaged
to adapt the applicable framework to the specificities of the crypto-activity and to the
specific requirements in Regulation (EU) 2023/1114. For example, the requirement
that issuers of high quality liquid assets in Delegated Regulation (EU) 2015/61 have
not to belong to the financial sector should not apply to issuers of highly liquid
financial instruments. In addition, Regulation (EU) 2023/1114 requires the currency
matching between the denomination of the reserve of assets and the denomination of
the assets referenced by the tokens. Furthermore, some exemptions to the general and
operational requirements applicable to some level 1 liquid assets subject to 0% haircut
in accordance with Delegated Regulation (EU) 2015/61should not be replicated in the
framework applicable to highly liquid financial instruments, to take into account the
quantitative limits set out in Regulation (EU) 2023/1114 to their inclusion in the
reserve of assets.
(6) The market value of the highly liquid financial instruments should be calculated
considering the cash-inflows and outflows that would derive from derivatives hedging
not only their market risk, including interest rate risk or currency risk, but also the
difference between the market value of the highly liquid financial instruments and the
market value of the assets referenced. This is particularly relevant for the case of tokens
that are not referenced to official currencies, which might be expected to be more
volatile.
(7) As mandated by Regulation (EU) 2023/1114, specific concentration limits by issuer
of highly liquid financial instruments should be provided, taking into account the
prudential framework applicable to UCITS. Therefore, it is necessary to introduce a
general 5% limit for securities and crypto-assets, a 35% limit for level 1 liquid assets
with 0% haircut, as referred to in Delegated Regulation (EU) 2015/61, and a 10% limit
in the cases of level 1 liquid assets consisting in extremely high quality covered bonds
as referred to in that Delegated Regulation.
(8) The definition of the highly liquid financial instruments with minimal market risk,
credit risk and concentration risk should also take into account the developments of
the work in the BCBS framework to identify the eligible reserve assets for crypto-
activities.
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(9) Considering that requirements set out in Article 38 of Regulation (EU) 2023/1114 shall
also apply to electronic money institutions issuing e-money tokens (either significant
or, where decided, non-significant), as per Article 58(1), point (a), and (2) of that
Regulation, this Regulation should also apply to those tokens that are subject to or
required to comply with those requirements.
(11) The European Banking Authority, in cooperation with the European Supervisory
Parliament and of the Council10 and with the European Central Bank, has conducted
open public consultations on the draft regulatory technical standards on which this
Regulation is based, analysed the potential related costs and benefits and requested the
advice of the Banking Stakeholder Group established in accordance with Article 37 of
Regulation (EU) No 1093/2010 of the European Parliament and of the Council,11
Article 1
Definition of highly liquid financial instruments
1. For the purposes of Article 38(1) of Regulation (EU) 2023/1114, financial

instruments shall be considered highly liquid financial instruments with minimal
market risk, credit risk and concentration risk where they comply with all of the
following:
(a) they comply with the general requirements laid down in Article 7 of
Commission Delegated Regulation (EU) 2015/61;12
(b) they comply with the operational requirements laid down in Article 8 of
Delegated Regulation (EU) 2015/61;
(c) they belong to one of the following categories of financial instruments:
(i) level 1 assets referred to in Article 10 of Delegated Regulation (EU)
2015/61 that are not subject to any haircut;
(ii) level 1 assets qualifying as exposures in the form of extremely high-
quality covered bonds, as referred to in Article 10(1), point (f), of
12Commission Delegated Regulation (EU) 2015/61 of 10 October 2014 to supplement Regulation (EU) No 575/2013 of
the European Parliament and the Council with regard to liquidity coverage requirement for Credit Institutions Text with
EEA relevance (OJ L 11, 17.1.2015, p. 1).
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Delegated Regulation (EU) 2015/61, up to 35 % of the value of the

reserve of assets;
(iii)where the tokens are not referenced to official currencies, other
financial instruments that are either assets referenced by the tokens
or derivatives relating to the assets referenced by the tokens.
For the purposes of the first subparagraph, point (a), the provision in Article 7(7),
point (aa), of Delegated Regulation (EU) 2015/61 shall not apply.
For the purposes of the first subparagraph, point (b):
(a) the operational requirements for credit institutions in Article 8 of Delegated
Regulation (EU) 2015/61 shall be read as referred to the [relevant] issuers of
tokens;
(b) Article 8(1), second subparagraph, points (a)(iii) and (b), and Article 8(6) of
Delegated Regulation (EU) 2015/61 shall not apply;
(c) Article 8(4), second subparagraph, of Delegated Regulation (EU) 2015/61
shall not apply with respect to assets referred to in Article 10(1), points (c) to
(e) and (g), of that Regulation.
For the purposes of the first subparagraph, point (c)(iii), and without prejudice to the
second subparagraph, where crypto-assets that qualify as financial instruments, as
referred to in Article 2(4), point (a), of Regulation (EU) 2023/1114, are included in
the reserve of assets:
(a) all reference to credit institutions in Article 7(3) of Delegated Regulation
(EU) 2015/61 shall be read as referred to the issuers of the token that hold the
reserve assets;
(b) Article 7(4) of Delegated Regulation (EU) 2015/61 shall not apply [to those
crypto-assets].
For the purposes of the first subparagraph, point (c)(iii), where financial instruments
that qualify as derivatives are included in the reserve of assets:
(a) subparagraph 1, points (a) and (b), shall not apply to those derivatives;
(b) those derivatives shall be taken into account for the purposes of Article 2 of
this Regulation.
2. For the purposes of computing the market value of the reserve of assets, haircuts
provided by Articles 10 to 19 of Delegated Regulation (EU) 2015/61 shall not apply.
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Article 2
Hedging derivatives to highly liquid financial instruments
The net liquidity outflows and inflows that would result in the event of an early close-
out of the hedge, including derivatives hedging the difference between the change of
the market value of reserve assets and the change of the market value of the assets
referenced by the token, shall be taken into account in the valuation of the highly
Article 3
Concentration limit by issuer of highly liquid financial instruments
1. The market value of highly liquid financial instruments with minimal market risk,
credit risk and concentration risk, as referred to in Article 38(1) of Regulation (EU)
2023/1114, issued or guaranteed by a single entity or by entities with close links shall
not be higher than:
(a) 35% of the market value of the reserve of assets, in the case of securities or
money market instruments that are not subject to any haircuts in accordance
to Articles 10 to 19 of Delegated Regulation (EU) 2015/61;
(b) 10% of the market value of the reserve of assets, in the case of extremely high
quality covered bonds as referred to in Article 10(1), point (f), of Delegated
Regulation (EU) 2015/61;
(c) 5% of the market value of the reserve of assets, in the case of other securities,
money market instruments or crypto-assets that qualify as financial
instruments, as referred to in Article 2(4), point (a), of Regulation (EU)
2023/1114.
2. The risk exposure to a counterparty in an OTC derivative transaction that is
unmargined shall not exceed:
(a) 10% of the market value of the reserve of assets, when the counterparty is a
credit institution; or
(b) 5% of the market value of the reserve of assets, in all other cases.
3. When applying paragraphs 1 and 2, token issuers shall look through to the underlying
exposures of collective investment undertakings (CIUs), as defined in Article 4(1),
point (7), of Regulation (EU) No 575/2013, whose units are included in the reserve
of assets.
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Article 4
Unwind mechanism
1. Issuers of asset-referenced tokens and/or, where applicable, e-money institutions

issuing e-money tokens shall apply the approach set out in paragraph 2 to all of the
following:
(a) the determination of the amount of the reserve of assets envisaged in Article
36(1) of Regulation (EU) 2023/1114;
(b) the application of the percentages of the reserve of assets with maximum
maturities established in [Article 1 and Article 2 of the RTS to further specify
the liquidity requirements of the reserve of assets under Article 36(4) of
Regulation (EU) 2023/1114];
(c) the application of the concentration limits by deposit counterparty established
in [Article 5 of the RTS to further specify the liquidity requirements of the
reserve of assets under Article 36(4) of Regulation (EU) 2023/1114];
(d) the application of the concentration limits by issuer of highly liquid financial
instruments established in Article 3.
The approach set out in paragraph 2 to the determination referred to in the first
subparagraph, point (a), shall apply without prejudice to the application of the
operational requirements set out in Article 1(1), first subparagraph, point (b), and the
35 % cap to covered bonds, as referred to in Article 1(1), first subparagraph, point
(c)(ii).
2. The issuers of asset-referenced tokens and/or, where applicable, e-money institutions
issuing e-money tokens shall consider the impact on the reserve of assets of the
termination of secured funding, secured lending or collateral swap transactions
entered into using reserve assets on at least one leg of the transaction, where the
transaction matures within 5 working days.
The reserve of assets shall be adjusted with an increase of its value, by an amount
equivalent to the market value of the cash or other reserve assets to be received at the
maturity of the transactions referred to in the first subparagraph, and with a decrease
of its value, by an amount equivalent to the market value of the cash or other reserve
assets to be posted at the maturity of those transactions.
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Example 1: 3 days (or 15 days for LCR for example) 100 EUR reverse repo and collateral are
sovereign bonds.
Before After After unwinding (amount

reverse reverse computable for the reserve of LCR
repo repo assets)
Cash: 0
Cash: 0 + 100 = 100 Sovereign bonds: 100
Cash:
Sovereign
100
bonds: Sovereign bonds: 100 – 100 = 0 Inflow: 0
100
Liquidity resources after unwinding the reverse repo in the reserve of assets =
Cash (100)
Liquidity resources after unwinding the reverse repo in the LCR = Sovereign
bonds (100)
Example 2: 3 days (or 15 days for LCR for example) 100 EUR reverse repo and collateral is not
liquid.
After unwinding
Before reverse (amount computable
After reverse repo LCR
repo for the reserve of
assets)
Cash: 0 Cash: 0 + 100 = 100 Liquid collateral = 0

Cash: 100
Liquid collateral: 0 Liquid collateral: 0 - 0 = 0 Inflow = 100
Liquidity resources after unwinding the reverse repo in the reserve of assets = Cash (100)
Liquidity resources after unwinding the reverse repo in the LCR = Inflows (100)
EN 23
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Example 3: 3 days (or 15 days for LCR for example) 100 EUR repo and collateral are sovereign
bonds.
After unwinding (amount

Before repo After repo computable for the reserve of LCR
assets)
Cash: 100
Cash: 100 - 100 = 0 Cash: 100
Sovereign
bonds: 100 Sovereign
Sovereign bonds: 0 + 100 = 100 Outflow: 0
bonds: 0
Liquidity resources after unwinding the repo in the reserve of assets = Sovereign bonds (100)
Liquidity resources after unwinding the repo in the LCR = Cash (100)
Example 4: 3 days (or 15 days for LCR for example) 100 EUR repo and collateral is not liquid.
After unwinding
(amount computable
Before repo After repo LCR
for the reserve of
assets)
Cash: 100 - 100 = 0

Cash: 100 Cash = 0
Liquid collateral: 0
Liquid collateral: 0 + 0 =
Liquid collateral: 0 Outflow = 100
0
Liquidity resources after unwinding the repo in the reserve of assets = 0
Liquidity resources after unwinding the repo in the LCR = Cash (100) – Outflows (100) = 0
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Example 5: 3 days (or 15 days for LCR for example) 100 EUR collateral swap (collateral given is
not liquid and collateral received is liquid).
After unwinding
(amount computable
Before swap After swap LCR
for the reserve of
assets)
Liquid collateral =100

Liquid collateral: Liquid collateral: 100 -
Liquid collateral: 0
100 100 = 0
Outflow = 100
Liquidity resources after unwinding the swap in the reserve of assets = 0
Liquidity resources after unwinding the swap in the LCR = liquid collateral (100) – Outflows
(100) = 0
Example 6: 3 days (or 15 days for LCR for example) 100 EUR collateral swap (collateral given is
liquid and collateral received is not liquid).
After unwinding
(amount computable
for the reserve of
assets)
Liquid collateral = 0
Liquid collateral: 0 +
Liquid collateral:100 Liquid collateral: 0
100 = 100
Inflow = 100
Liquidity resources after unwinding the swap in the LCR = liquid collateral (0) + Inflows (100) =
100
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Example 7: 3 days (or 15 days for LCR for example) 100 EUR collateral swap (collateral given
and received are liquid).
After unwinding
(amount computable
for the reserve of
assets)

Liquid Liquid collateral: Liquid collateral: 100 +
collateral:100 100 100 – 100 = 100
Inflow/Outflow = 0
Liquidity resources after unwinding the swap in the LCR = liquid collateral (100) + Inflows (0)
– Outflows (0) = 100
Example 8: 3 days (or 15 days for LCR for example) 100 EUR collateral swap (collateral given
and received are not liquid).
After unwinding
(amount computable
for the reserve of
assets)
Liquid collateral: 0 + 0
Liquid collateral:0 Liquid collateral: 0
–0=0
Inflow/Outflow = 0
Liquidity resources after unwinding the swap in the LCR = liquid collateral (0) + Inflows (0)
– Outflows (0) = 0
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Example 9: Unwinding and calculation of limits.
Reserve of assets before unwinding: 500 Reserve of assets after unwinding: 397
-Deposit with bank A: 50 (10%) -Deposit with bank A: 50 (13%)
-Deposit with bank B: 50 (10%) -Deposit with bank B: 50 + 47 (unwinding

the reverse repo): 97 (24%)
-Deposit with bank C: 50 (10%)
-Deposit with bank C: 50 (13%)
-Sovereigns A: 150 (30%)
-Sovereigns A: 150 – 100 (unwinding
-Sovereigns B: 100 (20%) collateral swap): 50 (13%)
-Covered bonds A: 50 (10%) -Sovereigns B: 100 (26%)
-Covered bonds B: 50 (10%) -Covered bonds A: 50 (13%)
Additional information on the -Covered bonds B: 50 – 50 (unwinding the

composition of the reserve of assets: reverse repo): 0
- Sovereigns A by 100 were received in a

collateral swap where non-liquid assets
were posted.
- Covered bonds B by 50 were received in

a reverse repo where cash by 47 was
posted from deposits B.
Limits, to be applied after the unwinding:
- Concentration deposit A: 13%, larger than the maximum 10% 13 by deposit

counterparty.
- Concentration deposit B: 24%, larger than the maximum 10% by deposit

counterparty.
- Concentration deposit C; 13%, larger than the maximum 10% by deposit

counterparty.
13
Assuming that bank A is a large institution and following Article 5 of the [draft to further specify the liquidity
requirements of the reserve of assets under Article 36(4) of Regulation (EU) 2023/1114]
EN 27
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- Concentration Sovereign A: 13%, lower than the maximum 35% by issuer.
- Concentration Sovereign B: 26%, lower than the maximum 35% by issuer.
- Concentration covered bonds A: 13%, larger than the maximum 10% by issuer.
- Covered bonds A and B: 13%, lower than the 35% cap.
The issuer would need to diversify deposits to not exceed the 10% limit by counterparty
while reducing covered bonds A exposures to max 10% by counterparty.
Article 5
Entry into force
Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
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ARTICLE 38(5) OF REGULATION (EU) NO 1114/2023

1. As per Article 10(1) and Article 15(1) of Regulation (EU) No 1093/2010 (EBA Regulation),
regulatory technical standards (RTS) and implementing technical standards shall be
accompanied by an Impact Assessment (IA) which analysis ‘the potential related costs and
benefits.' This section presents the IA of the main policy options included in this Consultation
Paper (CP) the draft RTS on the specification of highly liquid financial instruments, which the
EBA is mandated to develop under Article 38(5) of Regulation (EU) 2023/XXX on markets in
crypto-assets.
2. Regulation (EU) No 1114/2023 (Regulation (EU) 2023/1114) sets out a new legal framework for
issuers of ARTs and EMTs, requiring issuers that invest a part of the reserve of assets to do it in
highly liquid financial instruments with minimal market risk, credit risk and concentration risk
under Article 38 (1) of REGULATION (EU) 2023/1114. Paragraph 5 of that Article mandates the
EBA to specify the financial instruments that can be considered for the purposes of forming part
of the reserve of assets as highly liquid and with minimal market risk, credit risk and
concentration risk. In that paragraph the EBA is also mandated to devise concentration limits by
issuer of highly liquid financial instruments as a maximum percentage of the reserve of assets.
5.1.1 Problem identification and background
3. Article 36(1) of Regulation (EU) 2023/1114 requires issuers of asset-referenced tokens (ARTs),
whether they are either if the ARTs are significant ARTs or not, to constitute and maintain a
reserve of assets at all times to cover their liabilities against the holders of their issued ARTs
matching the risks reflected within these liabilities. The reserve of assets is composed of the
assets received when issuing the token holders and by the highly liquid financial instruments the
issuer may invest in. In the case of tokens referenced to official currencies, a minimum part of
the reserves should be held in the form of deposits in credit institutions (at least 30% of the
amount referenced in each official currency if the token is not significant, and at least 60% if the
token is significant). Upon redemption requests from token holders, the issuers should be able
to liquidate the reserve assets.
4. As established in Article 49 and Article 39, EMTs and ARTs holders can request redemption of
the tokens at any time, including stress scenarios, against the reserve assets. Upon redemption
requests, the issuers should be able to liquidate the highly liquid financial instruments to fulfil
the requests. The way the reserves are invested in will have implications on the overall liquidity
risks related to these issuers, and on financial markets due to potential triggering of fire sales.
This may in turn have implication on the financial stability as a whole.
29
5.1.2 Policy objective
5. The general objective of the policies in this RTS is to ensure financial stability by limiting the
liquidity related risks of the issuers of ARTs and EMTs, that could be triggered by the redemption
of tokens.
6. The specific objective of the policies specified in this RTS are to ensure that reserve assets can
be liquidated rapidly at or close to prevailing market prices, and that issuers of ARTs and EMTs
have a clear view of the instruments that are eligible to be included in their reserve of assets in
terms of categories of liquid assets, the general and operational requirements that they need to
fulfill, as well as concentration limits.
7. In addition, when developing its mandate the EBA needs to take into account:
- The specifications of the liquidity coverage ratio.
- The type of assets that can be referenced by the tokens and the correlation
between them and the highly liquid financial instruments.
- Concentration limits for UCITs under Article 52 of Directive 2009/65/EC.
5.1.3 Baseline scenario
8. In a baseline scenario there would be no RTS specifying the highly liquid financial instruments
that can be used by issuer of ARTs and EMTs to invest their reserve of assets. As a result, the
interpretation of the Regulation (EU) 2023/1114 in this respect would diverge significantly
across entities and may lead to significant liquidity risks.
5.1.4 Options considered, assessment of the options and preferred options
Policy issue 1: Categories of liquid assets in the LCR framework
9. Article 38(1) and (5) refers to financial instruments that can be considered highly liquid. The EBA
has assessed the different possible categories of liquid assets in the LCR and has confronted
them with the expectations of the highly liquid financial instruments in Regulation (EU)
2023/1114. For its specification the EBA takes into account the definition of financial
instruments in point (50) of Article 4 of the CRR in conjunction with Section C of Annex I of MIFID
II. Table 1 provides a description of the categories of the liquid assets in the LCR, with additional
columns specifying the haircuts and the caps applicable to each category of liquid asset.
10.As stated in Article 418(1) of the CRR, the haircuts applicable to liquid assets in the LCR reflect
at least the duration, the credit and liquidity risk and typical repo haircuts in periods of general
market stress. The BCBS standard on LCR refer also to the haircuts to cover additional price and
market liquidity risks. The haircuts ultimately protect against potential losses in the value of
liquid assets when liquidated in stressed conditions.
30
11.The caps, as maximum amount of the relevant category of liquid assets in the liquidity buffer,
are designed to reduce the risk that the liquidity buffer may be comprised of an excessive
amount of assets of lower liquidity.
Table 1. Categories of liquid assets in the LCR

Category Haircut Cap
Level 1 exposures to central banks, securities issued or

guaranteed by central governments, regional governments,
local authorities or public sector entities, promotional 0% None
bonds, securities issued or guaranteed by multilateral
development banks and specific international organisations.
70% of the
Level 1 extremely high-quality covered bonds At least 7%
liquidity buffer
Level 2A exposures to central banks, securities issued or Within the total

guaranteed by central governments, regional governments, Level 2 cap of 40%
At least 15%
local authorities or public sector entities, covered bonds, of the liquidity
corporate bonds. buffer
Within the total

Level 2 cap of 40%
At least between
of the liquidity
Level 2B securitisations, covered bonds, corporate bonds, 30% and 50%
buffer plus a Level
shares, depending on each
2B cap of 15% of
asset
the liquidity
buffer.
12.With regards to the categories of liquid assets to be included in the reserve of assets, the
following options were considered:
13.Option A: Only Level 1 0% haircut liquid assets. With this option the reserve of assets of an issuer
of a token referenced to an official currency other than EUR would be limited to:
• 0% haircut level 1 HQLA in the LCR as highly liquid financial instruments (35% of the reserve
of assets, considering the highest concentration limit by issuer to allow for the largest
possible amount of securities taking into account that there is only one issuer of 0% level 1
HQLA generally in non-euro area member states since currency matching between the
reserve of assets and the assets referenced is required in Regulation (EU) 2023/1114), and
• Deposits with credit institution (at least 30% of the amount referenced), which would need
to reach basically the remaining 65% of the amount of the necessary reserve of assets.
14.Option B: Only Level 1 liquid assets (including Level 1 extremely high-quality covered bonds)
With this option the reserve of asset would be composed of:
• 0% haircut level 1 HQLA in the LCR as highly liquid financial instruments (35% of the reserve
of assets, considering the highest concentration limit by issuer and the fact that there is
31
only one issuer generally to ensure currency matching between the reserve assets and the
assets referenced in the case of non-euro area member states),
• Deposits with credit institution (at least 30% of the amount referenced), and
• Level 1 extremely high-quality covered bonds in the LCR as highly liquid financial
instruments by not more than 35% of the reserve of assets.
15.Article 38(1) Regulation (EU) 2023/1114 requires that the highly liquid financial instruments in
the reserve of assets have minimal market risk, credit risk and concentration risk with the
objective that they can be liquidated rapidly with minimal adverse price effect.
16.With this the EBA considered that level 1 liquid assets in the LCR subject to 0% haircut met the
conditions required in Regulation (EU) 2023/1114 as regards minimal market and credit risk and
minimal adverse price effect in case of a rapid liquidation (Option A). To ensure a minimal
concentration risk a maximum percentage of the reserve of assets is proposed for highly liquid
financial instruments that are Level 1 and subject to 0% haircut in the LCR issued by a single
entity.
17.In addition, the EBA considered the case of assets referenced to EU official currencies other than
EUR. The concern arose as to if and how in these cases issuers might cover the minimum
necessary amount of the reserve of assets, with only deposits in credit institutions and 0% level
1 haircut liquid assets as highly liquid financial instruments which would be generally limited to
a single central government issuer (to ensure currency matching). Regulation (EU) 2023/1114
mandates the EBA to establish concentration limits by issuer, which in the case of 0% level 1
haircut liquid assets would be between 5% and 35% following the UCITs framework proposed in
Regulation (EU) 2023/1114.
It would force issuers in some specific

Only HQLA of the maximum quality Member States to concentrate a great
and minimal credit, market and part of their reserve of assets in deposits
liquidity risk in the LCR are allowed. with credit institutions with higher credit
Policy option A risk than securities.
(without covered It is a more straight forward approach
bonds) and less burdensome since it avoids The direct link with banks via deposits
any complexity in the calculation of would be much higher meaning that the
the cap of the covered bonds via the risk of a stress event to affect the
unwind mechanism. financial stability would be higher in
some member states.
The scope of definition of highly liquid

Allows to hold more securities in the financial instruments will not be
Policy option B reserve assets rather than deposits composed of the liquid assets in the LCR
(with covered with credit institution reducing the with the minimal credit, liquidity and
bonds) credit risk of the reserve assets as a market risk only if a haircuts based
whole. approach is taken into account.
However, this is controlled with a 35%
32
Reduces the direct link with banks cap and because still this is the second
and potential interactions with best category of HQLA in the LCR subject
financial stability in case of stress. to a 7% haircut only in the LCR in addition
to the fact that the eligible extremely
high quality covered bonds need to meet
the general and operational
requirements in the LCR.
It introduces the risk of misinterpreting
the amount of the reserve of assets since
secured lending, secured funding or
collateral swap transactions could
increase the amount of the covered
bonds eligible beyond the maximum 35%
temporarily until the close out of the
transaction. However, this is controlled
with the implementation of the unwind
mechanism, similarly to the LCR, for the
calculation of the maximum amount of
eligible covered bonds.
18.The EBA has opted for Policy option B. The EBA considered that level 1 extremely high-quality
covered bonds are necessary to ensure that all issuers across the EU, irrespective of the official
EU currency the assets might be referenced to, have the same opportunities to minimize the
risks of their reserve assets and of their financial stability. The EBA considers that the reserve of
assets with these covered bonds, which amount is capped to 35% of the reserve of assets, still
show a minimal exposure to credit and market risk. The concentration risk of them is controlled
also with a maximum amount of bonds being issued by the same entity.
33
Figure 1. Outstanding amount of government debt securities in the EU (EUR billion)
Figure 2. Amount of covered bonds issued by banks by Member State
400 25
EUR Billions
350
20
300
250
15
200
10
150
100
5
50
0 0
AT BE BG CY CZ DE DK EE ES FI FR GR HU IE IS IT LT LU LV MT NL NO PL PT RO SE SI SK
Sum of c0010 Number of banks
Source: EUCLID supervisory data, reference date: December 2022
34
Policy issue 2: Application of LCR general and operational requirements to highly liquid
instruments
19.When specifying the highly liquid financial instruments, as mandated in point (c) of Article 38(5),
the EBA shall take into account “the liquidity coverage requirement as referred to in Article 412
of Regulation (EU) No 575/2013 and as further specified in Commission Delegated Regulation
(EU) 2015/61”.
20.The Commission Delegated Regulation (EU) 2015/61 (LCR DR) provides definitional criteria to
identify specific categories of assets that could be considered as liquid assets for the LCR
purposes if they meet specific general and operational requirements. Liquid assets in the LCR
are ready to be liquidated immediately at any point in time, including under stress scenarios,
and with no or low loss of market value. Their characteristics might serve as the basis for the
definition of the eligible highly liquid financial instruments in the issuer’s reserve assets. Highly
liquid financial instruments in the reserve assets aim to meet similar targets under similar
conditions and scenarios, i.e. to cover payment of obligations in a prompt manner, including
stress scenarios, with no or low loss of value.
21.In this regard the following options where considered:
Option A: All general and operational requirements should be fulfilled as in the LCR.
Option B: All general and operational requirements should be fulfilled but excluding the
exemptions in the LCR for sovereign bonds.
22.The EBA assessed whether highly liquid financial instruments in the reserve of assets need to
meet the general requirements as envisaged in Article 7 LCR DR in Table 2, and whether highly
liquid financial instruments in the reserve of assets need to meet the operational requirements
as envisaged in Article 8 LCR DR in Table 3.
23.Based on the assessment, all the LCR general and operational requirements should apply also to
the highly liquid financial instruments in the reserve of assets. Exemptions to sovereign bonds
on them, as envisaged in the LCR, should not apply here. In the LCR level 1 sovereign bonds are
not subject to any haircut and are uncapped. However these sovereign bonds as highly liquid
financial instruments in the reserve of assets are capped as long as a material amount of deposits
with credit institutions is required as a minimum in the case of tokens referenced to official
currencies.
35
Table 2. Assessment of adequacy of LCR general requirements for highly liquid financial instruments
in the reserve of assets
LCR liquid assets Highly liquid financial instruments in the reserve of assets
Yes. This is required in REGULATION (EU) 2023/1114 (Recital 55, Art. 37(1)(a)) to
Unencumbered
ensure their ready availability.
Yes, to avoid exposure to wrong way risk. reasonable from a liquidity soundness
perspective and particularly under a stress situation, which is covered by
Not own assets or
REGULATION (EU) 2023/1114 (Articles 39(2) and 45(3)), including idiosyncratic
issued by group
cases, where the issuer might need to meet redemption requests. It contributes
entities
to avoid conflicts of interest in the management and investment of the reserve
of assets as envisaged in Article 32(2).
Yes, reasonable from a liquidity soundness perspective, especially for market

wide stress scenarios, covered by REGULATION (EU) 2023/1114 (Art 39(2)(b)).
Not issued by
The EBA envisages exceptions as in the LCR (cases of covered bonds or
financials
securitisations). Exception is assessed for crypto assets that can be issued by a
financial institution or credit institution.
Yes, without exemption for sovereign bonds considering that they are capped in
the reserve of assets since the issuer needs to have deposits with credit
institutions in the reserve of assets by at least 30% of the amount referenced in
each official currency by the token, or 60% if the token is significant. However,
Market value public or sovereign bonds are uncapped in the LCR and can benefit from not applying this
easy to determine requirement.
The reserve of assets needs to cover the liabilities against the tokens holders,
valued at market value (Art 36(7) and Art 39(2)). It seems appropriate to keep
this requirement here at least for the limited/capped amount of sovereign
bonds in the reserve of assets.
Yes, without exemption for sovereign bonds. Again, considering the capped
amount of sovereign bonds in the reserve of assets versus their uncapped
Listed on a recognised amount in the LCR liquidity buffer.
exchange or tradable
on generally accepted This requirement is inherent to the expectation of highly liquid financial
repurchase markets instruments in the reserve of assets in REGULATION (EU) 2023/1114, Article
38(1) (“The investments shall be capable of being liquidated rapidly with
minimal adverse price effect.”)
Table 2. Assessment of adequacy of LCR operational requirements for highly liquid financial
instruments in the reserve of assets
Yes, without exemption for sovereign bonds. Again, considering the capped
Diversified amount of the reserve of assets of sovereign bonds versus their uncapped
amount in the LCR liquidity buffer makes this requirement more necessary to
36
be met. Minimal concentration is required in REGULATION (EU) 2023/1114
(Article 38(1)). The EBA is mandated to calibrate concentration limits in the
RTS (Article 38(5).
Ready access to
Yes, inherent to the capability required in the reserve assets to be liquidated
monetise the reserve
rapidly in Art 38(1) and with prompt access to them by the issuer for any
assets without legal or
redemption request at any time (Art 37(1)(c)).
practical impediments
Under the control of the Article 37(1)(c) envisages that such ultimate control should be understood to
liquidity management be under the issuer as long as this article establishes that the issuers have
function within the prompt access to the reserve assets to meet any request of redemption from
credit institution the tokens’ holders.
Yes, without exemption for sovereign bonds. Seems reasonable from a

Subject to sales/repo liquidity soundness perspective, again considering the capped amount of the
test on a regular basis reserve of assets of sovereign bonds versus their uncapped amount in the LCR
liquidity buffer.
The LCR framework requires currency consistency between the liquidity buffer
and the net outflows. The level of currency consistency is not explicit in the
LCR DR where the credit institutions have the obligation to take the necessary
measures to ensure such consistency and where competent authorities may
also set specific limits for it.
Article 49(4) Regulation (EU) 2023/1114 establishes that issuers of EMTs upon
request by the token holder shall redeem it at any time and at par value by
paying in funds the monetary value of the EMT. Last subparagraph of Article
Currency consistency 39(2) Regulation (EU) 2023/1114 requires the issuer of ARTs to be able to
redeem the token in the same currency as the funds received when issuing
them. This means that the reserve of assets, that are used for the purposes of
the redemption of the tokens, need to be denominated in the same currency,
or hedged with currency swaps, as the obligation to the token holders, the
amount of the assets referenced. Therefore, a 100% currency consistency,
stricter than in the LCR, between the denomination of the reserve assets and
the EMTs or ARTs is already expected in Regulation (EU) 2023/1114 to ensure
that the redemption can be made in the same currency as the obligation to
the token holders. Therefore, the RTS should not refer to it.
Policy issue 3: Correlation between the highly liquid financial instruments and the assets
referenced by the token.
24.One of the most prominent risks associated with tokens is the lack of correlation between the
market value of the assets referenced and the reserve assets. Reserve assets such as
government bonds, covered bonds and deposits have little correlation with for instance
commodities. Figure 3 presents the prices of a few commodities (gold, silver and oil) that are
reference assets for certain tokens. The EBA assessed the eligibility of the financial instruments
used as assets referenced (or the financial instruments relating to assets referenced, e.g.
derivatives on assets referenced) as highly liquid financial instruments. With these instruments,
37
the token issuer will be able to establish a higher correlation between the assets and the
liabilities.
Figure 3. Commodity prices
A. Gold settlement spot (USD)
2100
2000
1900
1800
1700
1600
1500
B. Silver settlement spot (USD)
28
26
24
22
20
18
16
14
12
10
38
C. Current oil Brent settlement spot (USD)
150
130
110
90
70
50
30
10
Source: Capital IQ, S&P Global
25.Two policy options were considered here for the cases of tokens referenced to other than official
currencies:
Option A: Financial instruments used as assets referenced or derivatives relating to the assets
referenced are also added as highly liquid financial instruments to the general categories of
assets proposed under Policy issue 1.
Option B: No additional category of highly liquid financial instruments to the one proposed by the
EBA under Policy issue 1.
26.The following table summarises the main advantages and disadvantages for each policy option:
Potential unintended effects, like a

higher redemption request by token
holders with potential consequences
on the financial systems and the crypto
It gives the issuer the possibility to ecosystem, driven by a perceived high
increase correlation between the volatility of the market value of the
market value of the reserve assets reserve assets. This could happen if not
and assets referenced. read together with the sought to be
The issuer would adapt the covered volatility of the market value of
Option A amount of assets referenced in the asset referenced. This seems a real
the reserve of assets to its own possibility taking into account the
risk appetite and business model. complexity of these products.
Tokens with different risk profiles Some assets referenced used as highly
of issuers for different risk profiles liquid financial instruments would not
of investors would be available. form part of the definitional categories
of liquid assets in the LCR. However, the
general and operational requirements
for liquid assets in the LCR are required
here. This would allow for a good
39
balance between a good correlation
and maximum liquidity risk in these
assets referenced used as highly liquid
financial instruments.
Correlation between market value of

the highly liquid financial instruments
and the assets referenced would not be
Lower volatility in the reserve of
able to be fulfilled easily as required by
assets and market price of the
Option B token is expected.
Different types of assets referenced
Simplification of the eligible highly
would not be taken into account in the
definition of eligible highly liquid
financial instruments as required by
27.Regulation (EU) 2023/1114 does not seem to set too many restrictions to the assets that a token
can be referenced to. This might include for example, commodities, non-HQLA, indexes. Under
Option A financial instruments used as assets referenced (e.g. non-HQLA) or financial
instruments relating to assets referenced by the token (e.g. derivatives relating to commodities)
could be considered in the computation of the highly liquid financial instruments. No minimum
or maximum amount of assets referenced in the reserve of assets would be established.
28.The EBA has opted for Option A. The EBA assessed that the benefits are greater than the
potential disadvantages mainly because avoiding the possibility of correlation might indeed
make the reserve assets insufficient to pay the redemption requests of token holders at any
point in time. In addition to it Regulation (EU) 2023/1114 requires the EBA to take into account
the different types of assets referenced for the definition of the highly liquid financial
instruments. In any case the EBA does not set any minimum or maximum amount required in
the form of the assets referenced within the reserve of assets but considers it as part of the risk
management of the issuer to mitigate volatility by ensuring correlation and taking into account
its risk appetite.
29.The EBA assessed the convenience of applying the LCR haircuts in the measurement of the highly
liquid financial instruments. The EBA assessed that for simplification purposes a minimum
required overcollateralization in the determination of the liquidity requirements of the issuer’s
reserve of assets might suffice.
Policy issue 4: Concentration limits by issuer of highly liquid financial instruments
30.The EBA has considered the concentration limits by issuer envisaged Article 52 of Directive
2009/65/EC for the investments of UCITs and has assessed their application to the highly liquid
financial instruments as specified here.
40
31.Generally, the EBA follows the application of the 5% concentration limit by issuer for
investments in securities or money market instruments by UCITs and applies it for securities and
money market instruments in the form of highly liquid financial instruments in the reserve of
assets.
32. Specifically for the cases of securities issued or guaranteed by a public entity generally the UCITs
framework refers to the limit of 5% that can be increased up to 35% by the relevant Member
State. As regards the cases of covered bonds member states can also increase the 5%
concentration limit to 25%. The EBA has assessed these intervals for the determination of the
concentration limits of those securities as highly liquid financial instruments in the reserve of
assets taking into account some particular aspects. Two policy options were considered:
Option A: The default limit of 5% would apply to these categories of securities.
Option B: A 35% concentration limit would apply in the case of securities issued or guaranteed by
a public entity and a 10% for the cases of covered bonds.
33.The following table captures the main advantages and disadvantages for these options:
Keeping a 5% concentration limit for

government bonds issued by a single
entity would mean that the issuer of
tokens referenced to official currencies
other than EUR would be obliged to
hold deposits with credit institutions by
at least 60% of the assets referenced
(to meet the minimum necessary
reserve assets together with 35% of
A 5% concentration limit for covered bonds under policy option B
government bonds issued by a single related to the policy issue 1) while the
entity and for covered bonds issued EBA does not suggest to increase the
by a single bank is the most prudent minimum amount required of deposits
Option A
approach to ensure a maximum with credit institutions in its mandates
diversification. It would ensure the under Articles 36(4) and 45(7)(b)
wider diversification approach by Regulation (EU) 2023/1114.
issuer in the UCITs framework.
Keeping a 5% concentration limit by
issuer of covered bonds would
jeopardise the applicability of the 35%
limit for covered bonds under policy
option B related to the policy issue 1 in
the case of those EU member states
where the number of issuers of covered
bonds in the relevant non-EUR currency
is lower than 7.
It takes into account potential An increase of the most prudent 5%

Option B limitations for tokens denominated in concentration limit in the case of
other than EUR currencies. In these government bonds reduces
41
cases, when it comes to government diversification. However still a 35% is a
bonds, basically issuances from an minimum diversification envisaged in
only issuer can be eligible due to the the UCITs framework.
currency matching requirement in
A 10% concentration limit by issuer of
Regulation (EU) 2023/1114. A 5%
covered bonds would reduce the
concentration limit by issuer here
minimum diversification under UCITs
might be very restrictive for these
framework. However, a 10% is also
token issuers to meet the minimum
envisaged as a possibility in the UCITs
amount of reserve of assets required
framework for covered bonds.
to cover obligations against token
holders. However, a 35% limit, in
conjunction with the minimum
amount of deposits with credit
institutions required in Regulation
(EU) 2023/1114 (at least 30% of the
amount referenced) and up to 35% of
the reserve of assets in the form of
covered bonds under policy option B
related to policy issue 1 might suffice.
This is key to ensure that the
requirements in Regulation (EU)
2023/1114 can be met across all
member states without undue
restrictions.
A 5% concentration limit by issuer of
covered bonds might trigger
problems of insufficient number of
issuers for a currency other than EUR
that would affect the availability of
covered bonds of 35% of the reserve
of assets. This would require at least
7 active issuers for each currency.
With a 10% limit this issue would be
addressed and would ensure that
covered bonds are sufficiently
available in each EU currency while
ensuring a minimum diversification
by issuer in line with UCITs
framework.
34.The EBA opted for Option B. The EBA considers that it is a priority to ensure that issuers of tokens
referenced to currencies other than EUR in the EU have the possibility to mee the requirements
of reserve of assets without the need to implicitly impose higher minimum amount of required
deposits with credit institutions beyond the limits in Regulation (EU) 2023/1114 for which the
EBA does not suggest an increase. The increased concentration limits are still within the
accepted thresholds in the UCITs framework.
42

Question 1. Do respondents have any comment on the list of eligible highly liquid
financial instruments provided under point (c) of Article 1(1) of these draft
RTS?
Question 2. Do respondents have any comment on the general and operational

requirements to be met by highly liquid financial instruments provided
under points (a) and (b) of Article 1(1) of these draft RTS? Please explain if
some criteria is expected to be challenging to be met in practice.
Question 3. Do respondents find the treatment for hedging derivatives under Article 2
clear to be applied?
Question 4. Do respondents think that the draft RTS create any impediment for issuers
to ensure a good control of the correlation between the highly liquid
financial instruments and the assets referenced? This is particularly relevant
for the case of tokens referenced to assets other than official currencies.
Question 5. Do respondents have any concern about the feasibility for issuers to have
the minimum amount of reserve of assets considering the list of eligible
highly liquid financial instruments, the one-to-one currency matching
requirement in Regulation (EU) 2023/1114 and the concentration limits
under Article 3 of these draft RTS? This is particularly relevant for tokens
Question 6. Do respondents have any concern about the operational feasibility of the
look through approach envisaged in paragraph 3 of Article 3 of these draft
RTS? If yes, please elaborate your answer and specify the reasons for the
concerns.
Question 7. Do respondents have any comment with regards to the unwind mechanism
proposed under Article 4 of these draft RTS and the related examples
provided?
Question 8. Do respondents have any general comment about the interaction of these
draft RTS with the business model and the continuity of the business of
these activities?
Question 9. Do respondents find any provision in these draft RTS confusing or difficult to
understand?
Question 10. Do respondent have any comment on the impact assessment provided?
43
EBA/CP/2023/30
8 NOVEMBER 2023
Consultation Paper
Draft Guidelines
on recovery plans under Articles 46 and 55 of the Regulation (EU)
2023/1114
CONSULTATION PAPER ON DRAFT GUIDELINES ON RECOVERY PLANS UNDER ARTICLES 46 AND 55 OF
THE REGULATION (EU) 2023/1114
Contents
4. Draft guidelines 8
2


European Ombudsman.
Data protection
website.
3
Regulation (EU) 2023/1114 on markets in crypto-assets (MiCAR) establishes a holistic approach for
the regulation of crypto-asset issuance and crypto-asset service provision in the EU. Articles 46 and
55 of MiCAR set out an obligation for issuers of asset-reference tokens (ARTs) and issuers of e-
money tokens (EMTs) to develop and maintain a recovery plan providing for measures to be taken
by the issuer to restore compliance with the requirements applicable to the reserve of assets in
cases where the issuer fails to comply with those requirements. This requirement is imposed on all
issuers, regardless of whether the tokens are classified as significant. These draft guidelines specify
the format of the recovery plan and the information to be provided therein.
The draft guidelines set out that recovery plans should comprise four elements: a summary of the
key elements of the recovery plan, the information on governance, the description of the applicable
recovery options, and a communication and disclosure plan. As part of the information on
governance, issuers should include in the recovery plan a minimum set of categories of recovery
plan indicators. Among these categories, issuers should identify and calibrate the most relevant
recovery plan indicators based on their specific risk profile and operating environment. When
assessing what type of indicators will be included in the recovery plan, issuers should consider
carefully the type of events that may lead to a breach of the regulatory requirements applicable to
the reserve of assets. Recovery plan indicators should be of both quantitative and qualitative
nature. Moreover, all issuers should include a de-pegging risk indicator, aimed to keep track of the
alignment between the market price of the token and the market value of the referenced asset(s).
The draft guidelines also provide guidance on the steps to take in case of breaches of recovery plan
indicators.
When drafting the recovery plan, each issuer should identify the most appropriate recovery options
based on the size, complexity, business model, as well as the type of token. Among these, issuers
should include at least one recovery option that would strengthen the capital position and one
recovery option aimed at improving the liquidity position of the issuer. Issuers should also lay down
in their recovery plan an adequate number of scenarios whose nature is sufficiently varied to cope
with a wide range of shocks.
Finally, the draft guidelines include provisions aimed to avoid inconsistencies and overlaps with
other recovery plans, either drafted under MiCAR or under the Directive 2014/59/EU (so-called
‘BRRD’), and to ensure coordination among recovery plans drafted by multiple issuers of the same
token or by issuers offering two or more tokens to the public.
Next steps
The dra� guidelines are being publicly consulted for a three-month period. It is expected that they
will apply from 30.06.2024.
4
EBA Regular Use

Pursuant to Articles 46 and 55 of Regulation (EU) 2023/1114 ('MiCAR’), issuers of asset-referenced
tokens (ARTs) and issuers of e-money tokens (EMTs) have to draft and maintain a recovery plan laying
down measures to be taken by the issuer to restore compliance with the requirements applicable to
the reserve of assets in cases where the issuer fails to comply with those requirements. In addition,
recovery plans shall include: (i) the preservation of the issuer’s services related to the tokens; (ii) the
timely recovery of operations; (iii) the fulfilment of the issuer’s obligations in the case of events that
pose a significant risk of disrupting operations; (iv) appropriate conditions and procedures to ensure
the timely implementation of recovery actions; and (v) a wide range of recovery options. Article 46(6)
of MiCAR further mandate the EBA to ‘‘issue guidelines in accordance with Article 16 of Regulation
(EU) No 1093/2010 to specify the format of the recovery plan and the information to be provided in
the recovery plan”.
Through recovery planning, issuers of ARTs and EMTs should prepare in advance to face adverse
scenarios that may impact on their ability to comply with the regulatory requirements applicable to
the reserve of assets, inter alia by identifying and understanding their own risks and laying down
possible actions to restore compliance with regulatory requirements. The drafting of a recovery plan
should create awareness and preparedness and enable the issuer to consider and evaluate pre-
emptively the most appropriate and effective mitigation actions, without the pressures resulting from
actual severe stress.
In specifying the format and the information to be contained in the recovery plans, these guidelines
are largely based on the existing legislative framework and supervisory experience with recovery
planning for credit institutions adapted, where relevant, to reflect the specificities of ART and EMT
issuers. Accordingly, the recovery plan should be composed of three key elements (information on
governance, recovery options and a communication and disclosure plan) preceded by a summary.
However, considering that MiCAR provisions on recovery planning are less comprehensive and detailed
and also lack sufficient industry experience, these guidelines only provide high-level principles on the
key elements of the recovery plan, as well as on the minimum list of categories of recovery plan
indicators that issuers of ARTs and EMTs should include in their recovery plans.
Recovery plan indicators allow the issuer to identify any emerging risks that, if unmitigated, could
develop into severe stress situations. With an adequate framework of recovery plan indicators, the
issuer can establish predetermined criteria that may signal the necessity of an increased monitoring or
the activation of the recovery plan. In other words, these criteria should be set in a way to allow the
issuer to monitor, escalate and activate recovery options as appropriate. Therefore, as part of the
information on governance, each issuer should include the most appropriate recovery plan indicators
and thresholds that reflect the issuer’s specific size, complexity, nature and business model as well as
the token’s specific risk profile and operating environment. When doing so, each issuer should also
carefully consider the types of events that may lead to a breach of the regulatory requirements
applicable to the reserve of assets and calibrate the recovery plan indicators accordingly. For this
5
EBA Regular Use
reason, rather than setting a minimum list of indicators, these guidelines set a minimum list of
categories of recovery plan indicators and in Annex I provide an illustrative list of recovery plan
indicators that issuers could use as an inspiration. The EBA is of the view that it is key that issuers
consider that circumstances where the market price of the token is different than the market price of
the referenced asset(s) are likely to determine an increase in redemption requests. The likelihood of
sizeable redemption requests is larger when the loss of peg persists over an extended period of time
or is of material amount. Therefore, issuers should always include appropriate indicators related to the
referenced asset(s) and among these at least the de-pegging risk indicator.
For breaches to recovery plan indicator thresholds to effectively fulfil their warning potential, the
recovery plan should include how the issuer intends to (i) quickly activate a proper internal escalation
process in case of breach and (ii) promptly communicate said breach to the supervisor, so that a
constructive dialogue can start. With timing being crucial in deteriorating situations, issuers should
ensure that both the processes above take place in a timely manner. Considering that the execution of
recovery actions is more difficult when the amount at stake is larger, issuers of significant tokens are
expected to apply shorter timeframes to activate these processes.
As the ultimate goal of the recovery plan is to demonstrate the issuer’s capacity of restoring
compliance with the regulatory requirements by taking appropriate and timely actions, it is crucial that
recovery plans lay down a wide range of recovery options in addition to those laid down in MiCAR. In
situations of stress, it may be difficult for issuers to restore compliance with the regulatory
requirements applicable to the reserve of assets by means of actions that aim to stabilise the liquidity
of the reserve of assets only by imposing redemption fees or by limiting or stopping redemptions, as
these may not be able to limit the deterioration of the value or of the liquidity of the reserve of assets.
Therefore, while issuers are free to include the recovery options that they consider more effective
based on their size, complexity, nature and business model, they should always include in their
recovery plan at least one recovery option aimed to strengthen the capital position of the issuer and
one recovery option aimed to improve the liquidity position of the issuer. To enhance their recovery
capacity, when drafting the recovery plan issuers should use financial system-wide distress scenarios
and idiosyncratic financial and non-financial distress (including services distress) scenarios to test their
recovery planning capabilities.
Considering the different type of entities that could become issuers of asset-referenced tokens and e-
money tokens, these guidelines do not provide a minimum list of services that issuers need to preserve
pursuant to Article 46(1) of MiCAR.
With a view to increasing transparency for token holder and the public, these guidelines consider it
crucial that issuers have in place, as part of their recovery plan, a communication and disclosure plan,
outlining how the issuer intends to inform token holders and other stakeholder about the
implementation of recovery options and to manage possible negative market reactions.
Finally, these guidelines include provisions aimed to avoid inconsistencies and overlaps with other
recovery plans, either drafted under MiCAR (i.e. in the case of multiple issuers of the same token and
in the case of an issuer offering two or more tokens to the public) or under other EU sectorial legislation
6
EBA Regular Use
(i.e. under the Directive 2014/59/EU 1, so-called ‘BRRD’ and under Regulation (EU) 2022/2554 2, so-
called ‘DORA’). Indeed, the EBA considers it is crucial that, for instance, multiple issuers of the same
token calibrate the recovery plan indicators thresholds at the same level and implement recovery
options in a coordinated manner to ensure all token holders are treated fairly. In addition, considering
the principle of proportionality the EBA is of the view that a certain level of integration of recovery
plans drafted in compliance with MiCAR and with the BRRD should be explored, with issuers already
subject to draft recovery plans under the BRRD being able to provide the information laid down in
these guidelines in a streamlined manner. The application of this option should be subject to the
agreement of both authorities supervising compliance with MiCAR and the BRRD (in case these differ)
and in full compliance with the confidentiality requirements laid down in the BRRD. However, the EBA
is of the view that this option should not apply to credit institutions and investment firms issuing
significant ARTs, as these would be subject to its direct supervision.
1
Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the
recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and
Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and
Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014,
p. 190–348).
2
Regulation (EU) 2022/2554 of the European Parliament and of the Council of 14 December 2022 on digital operational
resilience for the financial sector and amending Regulations (EC) No 1060/2009, (EU) No 648/2012, (EU) No 600/2014, (EU)
No 909/2014 and (EU) 2016/1011 (OJ L 333, 27.12.2022, p. 1–79).
7
EBA Regular Use
4. Draft guidelines
EBA/GL/20XX/XX
DD Month YYYY
Draft Guidelines
on recovery plans under Articles 46 and

55 of the Regulation (EU) 2023/1114
8
1. Compliance and reporting obligations
Status of these guidelines

1. This document contains guidelines issued pursuant to Article 16 of Regulation (EU) No
1093/2010 3. In accordance with Article 16(3) of Regulation (EU) No 1093/2010, competent
authorities and financial institutions must make every effort to comply with the guidelines.
2. Guidelines set the EBA view of appropriate supervisory practices within the European System
of Financial Supervision or of how Union law should be applied in a particular area. Competent
authorities as in Article 3(1), point (35) of Regulation (EU) 2023/1114 4 to whom guidelines apply
should comply by incorporating them into their practices as appropriate (e.g. by amending their
legal framework or their supervisory processes).
Reporting requirements
3. According to Article 16(3) of Regulation (EU) No 1093/2010, competent authorities must notify
the EBA as to whether they comply or intend to comply with these guidelines, or otherwise
with reasons for non-compliance, by [dd.mm.yyyy – two months after publication of the
translations of the guidelines to all official languages]. In the absence of any notification by this
deadline, competent authorities will be considered by the EBA to be non-compliant.
Notifications should be sent by submitting the form available on the EBA website with the
reference ‘EBA/GL/202x/xx’. Notifications should be submitted by persons with appropriate
authority to report compliance on behalf of their competent authorities. Any change in the
status of compliance must also be reported to EBA.
4. Notifications will be published on the EBA website, in line with Article 16(3).
3
Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p.12).
4
(OJ L 150, 9.6.2023).
9
2. Subject matter, scope and definitions
Subject matter
1. These guidelines specify the format and the information to be contained in the recovery plan
that issuers of asset-referenced tokens and issuers of e-money tokens have to draw up and
maintain according to Articles 46 and 55 of Regulation (EU) 2023/1114 5.
Scope of application
2. These guidelines apply to issuers of asset-referenced tokens and e-money tokens as defined in
points 6 and 7 of Article 3(1) of Regulation (EU) 2023/1114 (hereinafter, for the purposes of
these guidelines, jointly referred as the ‘issuers’).
Addressees
3. These guidelines are addressed to competent authorities as defined in Article 3(1) point (35) of
Regulation (EU) No 2023/1114 to whom these guidelines relate.
4. These guidelines are also addressed to the issuers, as defined in point 10 of Article 3(1) of
Regulation (EU) 2023/1114, of:
a) asset-referenced tokens as defined in Article 3(1), point 6 of that Regulation (issuers of

asset-referenced tokens -ARTs-); and
b) e-money tokens defined in Article 3(1), point 7 of that Regulation (issuers of e-money
tokens -EMTs-).
Definitions
5. Unless otherwise specified, terms used and defined in Regulation (EU) 2023/1114 have the
same meaning in the guidelines.
5
(OJ L 150, 9.6.2023).
10
3. Implementation
Date of application
6. These guidelines apply from [30.06.2024].
11
4. Recovery plans for issuers of asset-

referenced tokens and issuers of e-
money tokens
4.1 Proportionality consideration

7. To ensure that the information to be provided in a recovery plan, its format and its review by
competent authorities is consistent with the individual risk profile, the nature and the business
model of the ARTs or EMTs issuer and the scale and complexity of its activities, issuers and
competent authorities should, when drawing up or assessing recovery plans, have regard to
the principle of proportionality.
8. To apply the previous paragraph, issuers and competent authorities should take into account
all of the following criteria:
a. the size, complexity, nature and business model of the issuer;
b. the classification of the asset-referenced token or e-money token issued as significant

pursuant to Articles 43 and 44 and Articles 56 and 57 of Regulation (EU) 2023/1114;
c. for issuers of asset-referenced tokens, the size, volatility, composition, concentration

and nature of the reserve assets and of the asset-referenced token itself;
d. for issuers of e-money tokens, the size, volatility, composition, and concentration of
the assets backing the funds received;
e. the significance and risk profiles of Crypto Asset Service Providers used in rendering
the services related to the asset-referenced tokens or e-money tokens issued by the
respective issuer;
f. the significance and risk profiles of DLT networks which are used by the respective
issuer in order to issue asset-referenced tokens or e-money tokens through them;
g. the risk profile of third party providers other than Crypto Asset Service Providers and
DLT networks which provide a significant or a critical ICT service to the respective
issuer.
9. For the application of the principle of proportionality, issuers that are classified as significant
should apply the requirements set out in paragraph 55 at least on annual basis and include in
their recovery plan all categories of recovery plan indicators laid down in paragraph 24.
Question for Public Consultation:
12
1. Is the approach to the application of the principle of proportionality adequate for the purposes
of recovery planning?
4.2 Content of the recovery plan

10. The recovery plan should be made up of all the following elements:
a) The summary of the key elements of the recovery plan, as further specified in Section 4.3
of these guidelines.
b) Information on governance, including a framework of recovery plan indicators and

monitoring thresholds, as further specified in Section 4.4 of these guidelines.
c) The description of the applicable recovery options, including at least a recovery scenario
analysis, a description of preparatory measures and information on the preservation of
services as further specified in Section 4.5 of these guidelines.
d) The recovery plan’s communication and disclosure plan, as further specified in Section
4.6 of these guidelines.
4.3 Summary of the key elements of the recovery plan

11. Issuers should include in their recovery plan a summary of the key elements of the recovery
plan as laid down in letters (b), (c), and (d) of paragraph 10.
12. In the summary of the key elements of the recovery plan, issuers should also list and highlight
the main changes to the previous version of the recovery plan submitted to the competent
authority.
4.4 Information on governance

13. Issuers should include in their recovery plan a clear and detailed description of the governance
processes related to the development, maintenance and implementation of the recovery plan.
14. The information on governance referred to in the previous paragraph should cover at least the
following:
a) the role(s) and function(s) of the person(s) responsible for preparing, implementing and
updating the plan;
b) the description of how the recovery plan fits with the issuer’s internal governance,
business strategy and risk management framework (including the risk appetite
statement);
c) the description of the processes and timeframes to be used for the periodical update of
the plan and for updating it to respond to any material changes affecting the specific
token, the issuer or its environment;
13
d) the policies and procedures governing the approval of the recovery plan and its reviews
and updates;
e) the description of the escalation procedures, meaning the conditions and procedures
necessary to ensure the timely implementation of particular recovery options foreseen
in the recovery plan. These should include at least clear information on the decision-
making process with regard to the activation of the recovery plan based on a clearly
detailed escalation process that applies when a breach of a recovery plan indicator
threshold is detected or is likely to materialise in the near future, to consider and
determine which recovery option may need to be applied to restore the compliance with
the relevant regulatory requirements applicable to the reserve of asset or to continue
rendering services related to the relevant token;
f) the time limit for the decision on taking recovery actions and the point in time, as well as
the modalities, for informing the competent authority;
g) the description of quantitative and qualitative indicators reflecting possible

vulnerabilities, weaknesses or threats to the amount, liquidity and allocation of the
reserve of assets and the funds that issuers have to maintain at any time pursuant to
Regulation (EU) 2023/1114, as further specified in paragraphs 16-35.
15. Where the issuers have entered in an arrangement with third party entities for operating the
reserve of assets, and for the investment of the reserve of assets, for the custody of the reserve
of assets, and, where applicable, for the distribution of the tokens to the public pursuant to
point (5)(h) of Article 34 of Regulation (EU) 2023/1114, they should include in their recovery
plan a clear and detailed description of the processes established to exchange information in a
way that would ensure the timely activation of the escalation process laid down in paragraph
31 in case a breach of recovery plan indicators is detected, either by the issuer or by the relevant
third party entity. The issuer should also specify in the recovery plan how the agreement with
any of those third parties ensures the information is timely shared in a way that would allow
the issuer to be aware of the breach or to acknowledge that the breach is likely to occur in the
near future so that the plan can be activated in a timely manner.
2. Do you have any comments on the need to exchange information between the issuer and the
relevant third party provider to avoid delays in the activation of the recovery plan in case the
issuer has entered into an agreement pursuant to point (5)(h) of Article 34 of Regulation (EU)
2023/1114?
Recovery plan indicators and monitoring thresholds
16. Issuers should lay down in the recovery plan an adequate framework of recovery plan
indicators, via which the issuer can establish predetermined criteria that may signal the
necessity of an increased frequency of monitoring or the activation of the recovery plan. These
criteria should be set in a way to allow the issuer to monitor, escalate and activate recovery
options as appropriate.
14
17. Recovery plan indicators should reflect both the token’s and the issuer’s specific risk profile and
operating environment. As such, the calibration of recovery plan indicators and thresholds
should be applied at the level of the token, except for the capital adequacy indicators that
should be calibrated at the level of the issuer, based on its specific size, complexity, nature and
business model and the operational risk indicators and the market confidence indicators that
should be calibrated both at the level of the issuer and at the level of the token.
18. When assessing what type of indicators will be included in the recovery plans, each issuer
should carefully consider the types of events that may lead to a breach of regulatory
requirements and elaborate specific indicators based on its internal risk assessment. Therefore,
issuers should not limit their set of recovery plan indicators to the list provided in Annex I.
Rather, they should consider the list of indicators provided in Annex I as illustrative, so they
may choose any or all of the indicators under each category.
19. In any case, issuers should consider the inclusion of the most appropriate indicators, even if not
included in Annex I, based on the criteria laid down in these guidelines, including for instance
to address environmental, social and governance risks, and in any other circumstances when
issues on a relevant field were identified.
20. Issuers should ensure that the list of recovery plan indicators and their calibration is based on
their internal risk assessment and that it is always consistent with its risk appetite framework.
Changes to the issuers’ risk appetite should trigger a review of the list of recovery indicators
and their limit aimed to assess that they remain suitable in case of changes to their risk appetite
framework.
21. Issuers should include in the recovery plan that they will monitor the recovery plan indicators
with an adequate frequency which would allow the timely submission of the indicators’ data
records to the competent authority upon request. Issuers should also specify how they will
monitor said indicators.
22. Issuers should include recovery plan indicators of both quantitative and qualitative nature.
When setting the quantitative recovery plan indicator thresholds, consistently with their overall
risk management framework in accordance with the [Draft Regulatory Technical Standards to
specify the minimum contents of the liquidity management policy and procedures under Article
45(7)(b) of Regulation (EU) 2023/1114], issuers should use progressive metrics (‘traffic light
approach’) in order to inform the issuer’s management body that such indicators threshold
could potentially be reached.
23. Issuers should include in the recovery plan at least the following categories of recovery plan
indicators, as further detailed in Annex I (Section A – “Minimum categories for all issuers of
ARTs or EMTs”), in particular:
1) liquidity risk indicators, informing the issuer of a potential or actual deterioration of the
liquidity profile of the reserve of assets;
2) operational risk indicators, describing the potential risks resulting from inadequate or
failed internal processes, people and systems or from external events, including legal
risk. When calibrating this type of indicators, issuers should specifically take into
account the type of underlying technology (e.g. permissioned/permissionless
distributed ledger) as well as its complexity (e.g. the existence of bridges, the quality of
15
the cryptography, etc). Issuers should also consider that relying on a unique and
complex infrastructure rather than on a standard one may have repercussions not only
on the ability to replace it, but also on the availability of people able to maintain and
fix it;
3) credit risk/asset-quality indicators, measuring the asset quality evolution of the reserve
of assets;
4) referenced asset(s)-related indicators, measuring the risk of massive redemption

requests, e.g. triggered by the loss of peg;
5) capital adequacy indicators, measuring the potential deterioration in the quantity and
quality of the capital position of the issuer, including the level of compliance with the
own funds requirements laid down in Article 35 of Regulation (EU) 2023/1114 and in
the [Draft Regulatory Technical Standards to specify the adjustment of own funds
requirements and stress testing of issuers of asset-referenced tokens and of e-money
tokens subject to the requirements in Article 35 of Regulation (EU) 2023/1114 on
markets in crypto-assets]. The calibration of such indicators should be set above their
applicable minimum regulatory requirement. Capital adequacy indicators should only
be used by ARTs and EMTs issuers that are not credit institutions.
24. Issuers should also include in the recovery plan the following categories of recovery plan
indicators, as further detailed in Annex I (Section B – Additional minimum categories for issuers
of significant ARTs and EMTs, and for other issuers that do not provide appropriate justification
for the non-inclusion to the competent authority):
6) market risk indicators, stemming from all the positions included in the reserve of assets,
including the volatility related to that of the asset(s) referenced;
7) concentration risk indicators, highlighting the excessive exposure of the reserve of

assets to a single counterparty or an interconnected set of counterparties;
8) market confidence indicators, capturing the potential negative perception of market

participants of the issuer or the token that could disrupt the issuer’s access to funding
and capital markets or determine a rapid increase of redemption requests;
25. By way of derogation, issuers of non-significant tokens are exempted from including the
categories of recovery plan indicators laid down in paragraph 24 as long as they provide
appropriate justifications to their competent authority that such categories are not suitable or
relevant to the risk profile, business model, size and/or complexity of the issuer.
26. Among the referenced asset(s)-related indicators, issuers should always incorporate at least a
de-pegging risk indicator, aimed to capture the risk that the market value of the token differs
from the market value of the asset(s) referenced 6. The de-pegging risk indicator should be
measured as the ratio between the market value of the token and the market value of the
referenced asset(s) and is expected to equal 1 at all times, with a tolerance interval not
6
The de-pegging risk is further explained in the [EBA Draft Guidelines establishing the common reference parameters of
the stress test scenarios for the liquidity stress tests referred in Article 45(4) Regulation (EU) 2023/1114].
16
exceeding 1%. Instances of ratios lower than 1 should trigger the issuer’s action as laid down in
its recovery plan.

3. Do you have any comments on the categories of recovery plan indicators and on the recovery
plan indicators listed in Annex I? Is the list of categories and recovery plan indicators clear? Is
there any additional indicator or category of indicators that should be added?
27. Issuers should clearly describe in the recovery plan to the satisfaction of the competent
authority how the calibrations of the recovery plan indicators have been determined and how
the thresholds would be breached early enough to be effective.
28. Issuers should describe in the recovery plan how they will regularly monitor and update the
appropriateness of the recovery plan indicators and the calibration of their thresholds. In
particular, issuers should specify how they would ensure the recovery plan is updated where it
is needed due to a change in the financial and business situation of the issuer and/or of the
specific token. Issuers should include in the recovery plan that any update in the calibration of
recovery plan indicator thresholds should be promptly notified and explained to the competent
authority. Issuers should ensure at all times that the recovery plan indicators and their
thresholds are fully consistent with the issuers’ risk management framework.
29. The content of the recovery plan should be drawn by issuers considering that there should be
no automaticity in the activation of recovery options upon breaching recovery plan indicators,
and that it would be for the issuer to decide whether and when to activate the recovery plan
or not in the case of a breach. When calibrating the recovery plan indicators, issuers should
ensure that they have this decision point at an early enough stage to be able to implement
action if needed.
30. Issuers should set out in the recovery plan their internal decision-making process. Issuers
should ensure that said process would be thorough and well-grounded, in line with paragraphs
33, 34 and 35. In addition, issuers should state in their recovery plan that, whether the issuer
decides to take action or not, they will keep an open and active dialogue with the competent
authority.
31. For breaches of recovery plan indicator threshold to effectively fulfil their warning potential,
issuers should lay down in their recovery plan that they will promptly and in any event:
• within maximum 24 hours from the breach of the recovery plan indicator threshold,
alert the issuer’s management body by activating the appropriate escalation process in
order to ensure that any breach is considered and, where relevant, acted upon; and
• at the latest within 24 hours following the activation of the internal escalation process,
notify the breach of the recovery plan indicator to the competent authority.
32. To account for the probability that the timeframes set under the previous paragraph may not
allow the issuer to react to the breach of a threshold in a timely manner, issuers should
determine the most appropriate time limit for the execution of those activities, on the basis of
the specificities of its operations, size and complexity of the reserve of assets. In any case, the
timeframes specified in the previous paragraph should not be extended.
17
33. Issuers should specify in the recovery plan that where a recovery plan indicator has been
breached, the management body of the issuer will assess the situation, decide whether to
trigger the activation of the recovery plan and promptly notify the competent authorities.
Issuers should also include in the recovery plan that the decision to activate the recovery plan
will cover the type of recovery actions to be taken.
34. Issuers should also specify in the recovery plan that the decision referred to in the previous
paragraph should be based on a reasoned analysis of the circumstances surrounding the
breach.
35. Issuers should describe in the recovery plan that where they decide to take action in accordance
with the recovery plan, the competent authority will be provided, without undue delay, with
an action plan based on a list of credible and feasible recovery options to be used in this stress
situation, together with a time plan to remediate the breach. The recovery plan should also
include that, if no action has been decided, the competent authority will be provided with an
explanation clearly articulating the reasons why and, where appropriate, demonstrating how
the restoration of specific types of indicators and their breaches is possible without the use of
recovery measures.
4.5 Recovery options

36. Issuers should lay down in their recovery plan a range of recovery options that are tailored on
the issuer’s business model and the nature of the asset-referenced or e-money token issued.
37. As regards the recovery options laid down in Article 46 of the Regulation (EU) 2023/1114,
issuers should apply the following:
a) the recovery plan should set a maximum amount for liquidity fees to be imposed on
redemptions and lay down how the duration of the measure will be communicated to
the public;
b) in setting the maximum amount of liquidity fees to be imposed on redemptions, issuers

should ensure that this recovery option is not applied as a means to increase the issuer’s
liquidity resources at the expenses of token holders. Issuers should ensure that this
recovery options is applied only temporarily during the distress phase with the sole
purpose to reduce redemption requests while stabilising the value of the token;
c) the recovery plan should set out different quantitative levels of limits on the number or
amount of tokens that can be redeemed on any working day. These levels should be
determined based on the severity of the breach(es) of recovery plan indicators and
should be set both at aggregate level (e.g. as a percentage of the entire amount of tokens
issued) and at wallet level;
d) the recovery plan should explain what other remedial actions the issuer will take once it
has suspended redemptions. Issuers should include in their recovery plan that they will
consider that suspending redemptions could negatively impact their reputation and the
confidence of token holders and result in higher volumes of redemption requests once
the suspension is lifted. Issuer should include in their recovery plan that they will
especially consider whether the lift of the suspension should be accompanied by other
18
measures, including but not limited to liquidity fees or limits to the amount of tokens
that can be redeemed on a daily basis;
e) issuers should include in the recovery plan how they plan to restore compliance with the
regulatory requirements and clearly communicate to the market the next steps.
38. In addition to the recovery options listed in Article 46 of the Regulation (EU) 2023/1114, issuers
should include at least one recovery option that would strengthen the capital position and one
recovery option aimed at improving the liquidity position of the issuer. A non-exhaustive list of
possible recovery options is provided in Annex III.
39. The recovery plan should also include details of any preparatory measure that the issuer should
take to facilitate the implementation of the recovery plan or to improve its effectiveness
together with a timeline for implementing those measures, as well as a description of any
measures necessary to overcome impediments to the effective implementation of recovery
options which have been identified in the recovery plan.
40. For every recovery option, issuers should include in the recovery plan a feasibility assessment,
which covers at least:
a) the assessment of the risks associated with the recovery option, whenever possible
drawing on any experience of executing the recovery option or an equivalent measure;
and
b) an analysis and description of any material impediment to the effective and timely
execution of the recovery option and a description of whether and how such
impediments could be overcome.
41. In addition, issuers should outline for every recovery option how the continuity of operations
will be ensured when implementing that option. This should include an analysis of internal
operations (e.g. information technology systems, suppliers and human resources operations)
and of the access of the issuer to key services from third parties which are essential for the
regular conduct of its operations.
42. To prove the credibility of recovery options, issues should provide quantitative and qualitative
evidence to support the expected benefits of each option. In any case, the recovery plan should
detail at least the items listed in Annex II.
43. Issuers also operating businesses other than the issuance of asset-referenced tokens and/or e-
money tokens should assess the implications for their overall recovery capacity arising from
those other businesses and should include in the recovery plan that they will adopt the most
appropriate measures to ensure compliance with Articles 46 and 55 of Regulation (EU)
2023/1114.
44. Issuers should include in their recovery plan how they plan to monitor the implementation of
the recovery options to ensure that the execution of the recovery plan is likely to restore
compliance with the regulatory requirements applicable to the reserve of assets.
45. Issuers should include in the recovery plan the process envisaged for the implementation
phase, always including an open and active dialogue with the competent authority to ensure a
19
smooth transition towards the implementation of the issuer’s orderly redemption plan
pursuant to Articles 47 and 55 of Regulation (EU) 2023/1114 should it become clear that
compliance with regulatory requirements applicable to the reserve of assets cannot be
restored.
Recovery scenarios
46. Issuers should ensure to lay down in their recovery plans an adequate number of scenarios
whose nature is sufficiently varied to cope with a wide range of shocks.
47. When developing their recovery plans, issuers should use financial system-wide distress
scenarios and/or idiosyncratic financial distress scenarios and/or non-financial distress
(including services distress) scenarios to test their recovery planning capabilities. Scenarios
used for recovery planning should be designed in a way that would threaten the issuer’s
compliance with requirements applicable to the reserve of assets if the issuer did not
implement recovery measures in a timely manner. The number and complexity of scenarios
should be determined by each issuer taking into account the principle of proportionality in line
with Section 4.1.
4. Is the section on recovery options and recovery scenarios appropriate and sufficiently clear,
also when read together with Annexes II and III?
Preservation of services
48. Issuers should lay down in the recovery plan how they intend to recover operations in a timely
manner and fulfil their obligations in case of events that pose a significant risk of disrupting
operations. Issuers should also list in the recovery plan the services they intend to preserve
based on their business model and detail how they will ensure the preservation of the services
related to asset-referenced and e-money tokens. The list of services to be preserved should at
least include services related to the issuance and the redemption of tokens. Where the
implementation of the recovery options has the potential to negatively impact the issuer’s
provision of any of the services identified, the description of the recovery options should
outline how the issuer plans to ensure the continuity of said services when implementing the
recovery plan.
49. Issuers that operate payment arrangements in euro – as defined by the Eurosystem oversight
framework for electronic payment instruments, schemes and arrangements (PISA framework)
– should ensure that recovery actions foreseen in the recovery plan are consistent with the
objective to maintain adherence to the principles outlined in the PISA framework.
50. In addition, issuers should ensure that actions foreseen in their recovery plan do not unduly
affect the ability of any Crypto Asset Service Providers they deal with 7 to comply with
7
Reference is made to Crypto Asset Service Providers (CASP) providing custodial services, offering exchange services for
conversion of ART to fiat and vice-versa. The recovery actions undertaken by the issuer should not conflict with the ability
of the CASPs to maintain compliance with DORA Regulation.
20
4.6 Communication and disclosure plan

51. Issuers should include in the recovery plan a communication and disclosure plan outlining how
the issuer intends to inform token holders and other stakeholders, including the public, about
the implementation of the recovery options and to manage any potentially negative market
reaction.
52. The communication and disclosure plan should clarify how the issuer intends to communicate:
a) internally, in particular to staff, works councils and other staff representatives, if any;
and
b) externally, in particular to token holders, shareholders and other investors, competent

authorities, financial markets and financial market infrastructures, other counterparties
and the general public, as appropriate.
53. In the communication and disclosure plan the issuer should also include how they will ensure
the preservation of its token-related services, the foreseen timelines for recovering its
operations and for the fulfilment of its obligations. The communication and disclosure plan
should also cater for scenarios in which it is unlikely that the issuer will recover operations or
will fulfil its obligations, thus leading to the activation of the issuer’s redemption plan.
4.7 Format and maintenance of the recovery plan

54. Issuers should draft their recovery plan in a clear and understandable language. The recovery
plan should be complete, self-explanatory, accurate and contain at least all the information
listed in these guidelines.
55. Issuers should include in their recovery plan that the information provided therein will be
updated periodically and at least every time there is a material change in the business or
financial profile of the issuer and/or of the token issued. Any review or update of the plan
should be notified to the competent authority without undue delay. Issuers of significant
tokens should include in their recovery plan that they will update the information provided
therein at least on an annual basis.
4.8 Interaction between different recovery planning obligations

Multiple issuers of the same token and issuers offering two or more tokens to the public
56. When an asset-referenced token or an e-money token is issued by multiple issuers, all issuers
should include in their recovery plan how they will ensure effective coordination among the
respective recovery plans. In particular, issuers should establish in their recovery plan
appropriate measures aimed at ensuring that:
a) recovery plan indicators are aligned to the maximum possible extent;
b) thresholds of token-related recovery plan indicators are set at the same level;
c) recovery options laid down in each plan are consistent with each other;
21
d) the activation and execution of the respective recovery plans is agreed and coordinated
among all issuers;
e) the implementation of certain recovery options by one of the issuers does not negatively
impact on the implementation of other recovery options by the other issuers;
f) the execution of the recovery plans is done in a way that all token holders are treated
fairly and equally.
57. As regards the format, issuers that offer two or more tokens to the public should draft a
recovery plan for each asset-referenced and/or e-money token they issue and calibrate token-
specific recovery plan indicators and thresholds therein.
58. Competent authorities should consider whether issuers that offer two or more tokens to the
public should draft one separate recovery plan for each token issued or a single recovery plan
divided into separate sections, each laying down token-specific elements. This second option
should be excluded where one of the tokens is issued by multiple issuers.
59. Issuers offering two or more tokens to the public should at least ensure that:
a) issuer-related recovery plan indicators are consistent and the respective thresholds are
set at the same level;
b) recovery options laid down for each token are not contradicting each other;
c) the activation and execution of one recovery plan would not negatively impact on the
activation and execution of other recovery plans;
d) the implementation of any recovery option does not interfere with the provision of
services related to the other tokens issued.
Issuers subject to other recovery planning obligations under EU sectoral legislation
60. Where the issuer is a credit institution or an investment firm required to draw a recovery plan
under the Directive 2014/59/EU 8, subject to the prior agreement with the competent
authorities designated under Regulation (EU) 2023/1114 and Directive 2014/59/EU, and
subject to the compliance with the confidentiality requirements laid down in Directive
2014/59/EU, such issuer:
a) may include in the recovery plan to be submitted to the competent authority as laid down
in Article 46(2) of Regulation (EU) 2023/1114 the information required under paragraph 14,
letters (a) to (f), and paragraphs 51-53 of these guidelines as an annex to the recovery plan
drafted and approved in accordance with Directive 2014/59/EU by cross-referencing its
8
Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the
recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and
Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU,
and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173,
12.6.2014, p. 190–348).
22
relevant sections, including the necessary clarifications to render such information fully
compliant with these guidelines, where applicable;
b) may, in addition to subparagraph (a) above, provide any information specified under
paragraph 14, letters (a) to (f), and paragraphs 51-53 of these guidelines that is not already
provided in their recovery plan prepared in accordance with Directive 2014/59/EU or which
requires any amendment to comply with these guidelines by including it in the annex
referred in subparagraph (a);
c) opting for the approach referred in subparagraphs (a) and/or (b) above, should incorporate
the key element of the recovery plan as laid down in paragraph 10 as an annex to their
recovery plan developed in accordance with Directive 2014/59/EU and clearly identify in a
statement/index the specific sections and pages where the information laid down in these
guidelines is included.
61. The previous paragraph does not apply to credit institutions and investment firms that are
issuers of significant asset referenced tokens.
62. In addition, issuers should ensure that actions foreseen in their recovery plan are consistent
with the ICT response and recovery plan requirements laid down in Regulation (EU)
2022/2554 9.
5. Do you have any comments on the interaction between different recovery planning
obligations? Are there any other operational efficiencies that can be achieved? Please describe
them.
9
Regulation (EU) 2022/2554 of the European Parliament and of the Council of 14 December 2022 on digital operational
resilience for the financial sector and amending Regulations (EC) No 1060/2009, (EU) No 648/2012, (EU) No 600/2014,
(EU) No 909/2014 and (EU) 2016/1011 (OJ L 333, 27.12.2022, p. 1–79).
23
Annex I – List of minimum categories of

recovery plan indicators and illustrative
list of recovery plan indicators
List of minimum categories and non-exhaustive list of recovery plan indicators
A. Minimum categories for all issuers of ARTs and EMTs
Category 1. Liquidity risk indicators
a) Sight deposits at credit institutions and (where applicable) central banks / daily
redeemed amount (five rolling day average)
b) Sight deposits at credit institutions and (where applicable) central banks + reverse
repurchase agreements that can be terminated by one working day notice + highly liquid
financial instruments / highest daily redeemed amount over the last three months
c) Sight deposits at credit institutions and (where applicable) central banks+ reverse
repurchase agreements that can be terminated by five working day notice + highly liquid
financial instruments / sum of the five highest daily redeemed amounts over the last
twelve months
d) Sight deposits at credit institutions and (where applicable) central banks + reverse
repurchase agreements that can be terminated by one working day notice + highly liquid
financial instruments / sum of highest daily redeemed amount over the last three
months to the (x 10) largest token holders
e) Daily net flow, i.e. token issued – token redeemed (five rolling day average)
Category 2. Operational risk indicators
a) Any incident significantly disrupting the regular operation of the issuer’s services or its
business continuity (e.g. prolonged outage affecting IT systems or token delivery
systems; infrastructure failures, including dysfunctions of the Distributed Ledger
Technology; risks stemming from interoperability of different infrastructures, e.g. via
bridges), also where caused by a third party service provider
b) Recovery Time Objective (i.e. the maximum acceptable time to recover from a product
or system failure)
c) Maximum time since resignation or prolonged absence of key personnel
10
Issuers should determine in concrete the number of the largest token holders by taking into account the principles laid
down in these guidelines. Issuers may use multiple indicators, each one with a different number of the largest token
holders if this suits better with their risk management practices.
24
d) Breach or expected breach of any regulatory requirement
e) Legal risk
Category 3. Credit risk/asset-quality indicators
a) Highly liquid financial assets with impairment indicators (e.g. indicators of impairment
to credit quality as laid down in IFRS 9) / reserve of assets
b) Total amount of the reserve of asset held as deposits placed at credit institutions as per
issuer’s risk appetite / total banking deposit within the reserve of assets
c) Distance from the minimum level of over-collateralization (as indicated in Article 6 of the
[Draft Regulatory Standards to further specify the liquidity requirements of the reserve
of assets under Article 36(4) of Regulation (EU) 2023/1114])
d) Negative change in the credit rating of key counterparties (e.g. credit institution holding
issuer’s deposit)
Category 4. Reference asset(s) related indicators
a) De-pegging risk, to be measured as the ratio between the market value of the token and
the market value of the referenced asset(s)
b) Regulatory changes negatively affecting the reference asset(s)
c) Freeze or significant negative change in the liquidity of the market where the referenced
asset(s) is (are) exchanged
Category 5. Capital adequacy indicators
a) Own funds indicator
B. Additional minimum categories for issuers of significant ARTs and EMTs and for other issuers
that do not provide appropriate justification for the non-inclusion to the competent authority
Category 6. Market risk indicators
a) Ratio ‘Daily change of reserve of assets’ fair value / (x 11) rolling day average’
b) Ratio ‘Reserve of assets’ volatility / referenced assets’ volatility’
c) Sensitivity to interest rate changes of the reserve of assets
d) Ratio ‘Value At Risk of the reserve of assets / issuer’s own funds’
Category 7. Concentration risk indicators
a) Ratio ‘Value of token held by five largest counterparties / total value of token issued’
11
Issuers should determine in concrete the number of days, by taking into account the principles laid down in these
guidelines. Issuers may use multiple indicators, each one with a different time horizon if this suits better with their risk
management practices.
25
b) Ratio ‘(Deposit at single banking group + securities issued by a single counterparty) /

maximum concentration limit 12’
c) Concentration ratio of deposits held in credit institutions / maximum concentration ratio

for deposits
Category 8. Market confidence indicators
a) Negative media coverage 13 for the issuer or the tokens issued
b) Negative news or media coverage for key counterparties (e.g. provider of custodial
services; banks holding a material amount of deposits)
c) Breach or expected breach of recovery plan indicators relative to any other token issued
d) Material changes in the frequency or amount of payments executed by using the token
as well as in the way tokens are used as a means of payment
e) Impairment to the reputation of the issuer or of key representatives of the issuer
f) Sudden increase in redemption requests
g) Sudden decrease of token issuance
12
See the Draft Regulatory Standards to further specify the liquidity requirements of the reserve of assets under Article
36(4) of Regulation (EU) 2023/1114.
13
Reference to media includes social networks and specialised blogging platforms.
26
Annex II – List of items to be included in

the description of each recovery option
1. The description of the recovery options should include:
a) A summary of the essential elements.
b) A description of the recovery option.
c) An overview of the key assumptions underlying each recovery option.
d) An assessment of the strategic implications of executing the recovery option.
e) An assessment of the financial impact in normal and stressed market conditions.
f) The potential adverse consequences of the recovery option.
g) A timeline for effective execution, including the expected time frame for the
implementation of the necessary actions.
h) Any dependency on external counterparties for effective execution.
i) Mutual exclusivity – whether some recovery options are mutually exclusive.
j) Interdependencies – whether activating one recovery option could affect the subsequent
or simultaneous implementation of another option.
k) Operational considerations, such as approval requirements and capability to implement

two or more recovery option simultaneously.
l) An assessment of potential constraints to effective execution. This assessment is

particularly relevant with respect to options referred under point (1) of Article 46 of
m) The communication strategy to inform the holders of the tokens about any measures
that could adversely impact them.
27
Annex III – Non-exhaustive list of possible

recovery options that issuers could use in
their recovery plans
1. Capital raising.
2. Injection of additional funds.
3. Access to standard central bank facilities, where eligible.
4. Change of composition and/or reduction of the riskiness of the reserve of assets.
5. Change of the third-party provider (e.g. Crypto Asset Service Provider).
6. Purchase of financial guarantees from a credit institution or an insurance company covering the
value of the reserve of assets.
7. Sale of business.
8. Merger with another issuer.
9. Merger of one issuance of asset-referenced tokens with another one.
10.Commercial measures.
28

As per Article 16(2) of Regulation (EU) No 1093/2010 (EBA Regulation), any guidelines and
recommendations developed by the EBA shall be accompanied by an Impact Assessment (IA), which
analyses ‘the potential related costs and benefits’.
This analysis presents the IA of the main policy options included in this Consultation Paper on the
draft guidelines on recovery plans under Articles 46 and 55 of the Regulation (EU) 2023/1114 (‘the
draft guidelines’). This IA is high level and qualitative in nature.
According to Article 46 of Regulation (EU) 2023/1114, an issuer of an asset-referenced token shall

draw up and maintain a recovery plan providing for measures to be taken by the issuer to restore
compliance with the requirements applicable to the reserve of assets in cases where the issuer fails
to comply with those requirements. The same applies, mutatis mutandis, to issuers of e-money
tokens (Article 55 of Regulation (EU) 2023/1114).
However, Regulation (EU) 2023/1114 does not provide a comprehensive list of information that
should be included in the recovery plan, nor specifies how issuers should identify the circumstances
that could lead the issuer to breach compliance with the regulatory requirements applicable to the
reserve of assets. This could lead to a lack of harmonisation in current practices among issuers
across the EU in developing recovery plans, especially with regards to recovery plan indicators. This
situation would also make the assessment of the recovery plans very challenging for the competent
authorities and undermine their supervisory role.
The general objective of the guidelines is to specify the format and the information to be contained
in the recovery plan that issuers have to draw up and maintain under Articles 46 and 55 of
Regulation (EU) 2023/1114. More specifically, these guidelines aim to ensure consistency of
information provided by issuers, with a view to ensure harmonised supervision across the EU.
The baseline scenario is the situation where Regulation (EU) 2023/1114 only provides for a general
obligation for issuers to draft recovery plans, without any further specification. Considering that
some issuers may not be familiar with recovery planning, it is necessary to ensure minimum
29
guidance, especially with regards to the elements and the categories of indicators that issuers
should include in the recovery plan.
With the entry into force of Regulation (EU) 2023/114, issuers of asset-referenced tokens and e-
money tokens must comply with Articles 46 and 55 of the Regulation. The above legal requirements
form the baseline scenario of the impact assessment, i.e. the impact caused by the Regulation is
not assessed within this impact assessment, which focuses only on areas where further
specifications have been provided in the guidelines.
The following aspects have been considered when developing the draft guidelines.
D. Options considered and preferred options
Policy issue 1: Format of the recovery plan
The first element of the legal mandate for the guidelines on recovery plans under Regulation (EU)
2023/1114 requires the EBA to specify the format of recovery plans. In this context, the EBA
considered two policy options.
• Option 1a. Design a single template for recovery plans under Regulation (EU) 2023/1114.
• Option 1b. Provide only a high-level guidance on the format of the recovery plan, by
specifying the elements of the recovery plan and the information to be contained therein.
By designing a single template to be filled by each issuer, Option 1a would ensure that Regulation
(EU) 2023/1114 recovery plans across the EU are highly standardised and comparable. On the other
hand, it would imply higher costs, as the same templates would apply to all types of issuers,
regardless of their size, complexity and business model and of the classification of the token as
significant.
Option 1b envisages providing only a high-level guidance on the format of recovery plans without
developing any specific template that would need to be followed by issuers. This option would give
issuers more flexibility in preparing their recovery plans, while ensuring harmonisation and
consistency on the key elements that issuers should include in their recovery plan.
Therefore, Option 1b has been chosen as the preferred option.
Policy issue 2: Recovery indicators as part of governance
The second element of the legal mandate for the guidelines on recovery plans under Regulation
(EU) 2023/1114 requires the EBA to specify the information to be contained in the recovery plan.
The following options have been considered.
30
• Option 2a. Include only a general, high-level guidance on the appropriate conditions to
ensure the timely implementation of recovery actions without requiring issuers to have any
specific recovery plan indicators.
• Option 2b. Include a general guidance on categories of recovery plan indicators and key
recovery plan indicators, without specifying comprehensive requirements on the
framework on recovery plan indicators.
• Option 2c. Include specific guidance on a framework of recovery plan indicators and on
their calibration as part of the information on governance.
Clear requirements on the recovery plan indicators (Option 2c) might increase certainty of issuers
on the points in time when they would need to consider activating their recovery plans. However,
it would also limit the ability of recovery plans to cater for particular risks specific to the size,
complexity and business model of the issuer or to the size, volatility, composition, concentration
and nature of the reserve of assets. On the other hand, not providing any requirements on recovery
plan indicators (Option 2a) would allow issuers excessive discretion, with the risk that recovery
plans would not be fit for purpose.
The EBA is of the opinion that these guidelines should provide general guidance on the categories
of recovery plan indicators to be included in the recovery plan (Option 2b), inter alia by providing
examples of possible recovery plan indicators that issuers of asset-referenced tokens and e-money
tokens should include in their recovery plan. As a result, this option would ensure that recovery
plans are tailored to the specificities of each issuer and token, while providing sufficient information
to ensure that the recovery plans cover all the relevant information.
Therefore, Option 2b. has been chosen as the preferred option.
E. Cost-Benefit Analysis
Overall, the guidelines are expected to provide advantages to both issuers and competent
authorities by clarifying the format and the information to be provided in the recovery plan under
Articles 46 and 55 of Regulation (EU) 2023/1114, without adding any additional material burden.
Clear indication on the

information and format of the
recovery plan
Issuers None
Flexibility on the recovery plan
indicators to be included in the
recovery plan
31
Harmonisation of the key

Lack of a common template may
elements and minimum
Competent authorities increase the time for supervisory
requirements of the recovery
assessment
plan
Increased transparency once a

Token holders None
recovery option is implemented
32

Q1. Is the approach to the application of the principle of proportionality adequate for the purposes
of recovery planning?
Q2. Do you have any comments on the need to exchange information between the issuer and the
relevant third party provider to avoid delays in the activation of the recovery plan in case the issuer
has entered into an agreement pursuant to point (5)(h) of Article 34 of Regulation (EU) 2023/1114?
Q3. Do you have any comments on the categories of recovery plan indicators and on the recovery
plan indicators listed in Annex I? Is the list of categories and recovery plan indicators clear? Is there
any additional indicator or category of indicators that should be added?
Q4. Is the section on recovery options and recovery scenarios appropriate and sufficiently clear,
also when read together with Annexes II and III?
Q5. 5. Do you have any comments on the interaction between different recovery planning
obligations? Are there any other operational efficiencies that can be achieved? Please describe
them.
33
EBA/CP/2023/29
08 NOVEMBER 2023
Consultation Paper

to specify the procedure and timeframe to adjust its own funds
requirements for issuers of significant asset-referenced tokens or of
e-money tokens subject to the requirements set out in Article 45(5)
of Regulation (EU) 2023/1114 on markets in crypto-assets
1
Contents
2
CONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS ON THE PROCEDURE AND TIMEFRAME TO ADJUST
THE OWN FUNDS REQUIREMENTS FOR ISSUERS OF SIGNIFICANT ASSET-REFERENCED TOKENS OR OF E-MONEY TOKENS
SUBJECT TO THE REQUIREMENTS IN ARTICLE 45(5) OF REGULATION (EU) 2023/1114 ON MARKETS IN CRYPTO-ASSETS

European Ombudsman.
Data protection
website.
3
Pursuant to paragraph 1 of Article 35 of Regulation (EU) 2023/1114 issuers of asset-reference
tokens are subject to own funds requirements, and in accordance with paragraph 5 of Article 45 of
the same regulation issuers of significant asset-reference tokens should hold higher amounts of
own funds (3% of the average amount of the reserve assets instead of 2%).
According to the mandate in Article 45(7)(c) of Regulation (EU) 2023/1114, the EBA has been
mandated to developed Regulatory Technical Standards (RTS) 1 specifying the procedure and
timeframe for an issuer of asset-referenced tokens to adjust its own funds to higher amounts when
an asset-referenced token it issues, or has issued, is classified as significant.
The mentioned requirements apply as well to electronic money institutions issuing e-money tokens
that are significant by virtue of Article 58(1), point b, of Regulation (EU) 2023/1114 and can be
expanded to e-money institutions issuing e-money tokens that are not significant if the competent
authority of the home Member State requires it so following Article 58(2) of that Regulation.
Given the novelty of asset-referenced tokens and their issuers, the fact no universal risks
assessment framework exists and the rapid developments in this sector, these RTS have been
developed with a certain degree of flexibility for competent authorities while keeping the main
overall objective of harmonisation of rules and convergence of supervisory practices.
The EBA followed a more prescriptive approach when specifying the procedure for issuers of a
significant asset-referenced token to submit a compliance plan, while provided more flexibility to
competent authorities on the timeframe to grant an issuer of a significant asset-referenced token
to adjust to higher own funds requirements (up to 3 months).
Next steps
The final draft RTS will be submitted to the Commission for adoption. Following the submission, the
RTS will be subject to scrutiny by the European Parliament and the Council before being published
1
This Regulation is also relevant for issuers of e-money tokens that are subject to or required to comply with the
requirements referred to in Article 45(5) of Regulation (EU) 2023/1114
4

1. Article 35(1) of Regulation (EU) (EU) 2023/1114 introduces the own funds requirement for
issuers of asset-referenced tokens. Issuers of asset-referenced tokens, shall at all times have
own funds equal to an amount of at least the highest of:
a. EUR 350.000;
b. 2% of the average amount of the reserve assets (referred to in Article 36);
c. A quarter of the fixed overhead of the preceding year.
2. According to Article 45(5) of Regulation (EU) 2023/1114, the 2% percentage shall be set at 3%
of the average amount of the reserve assets for issuers of significant asset-referenced tokens.
3. The EBA is mandated under Article 45(7)(c) of Regulation (EU) 2023/1114, in close cooperation
with ESMA, to develop draft regulatory technical standards further specifying2:
c. the procedure and timeframe for an issuer of a significant asset-referenced token

to adjust the amount of its own funds as required by paragraph 5.
4. The main purpose of these draft RTS is to provide the procedure and timeframe on how and
when the issuers of asset-referenced tokens should adjust their level of own funds to 3% of the
average amount of the reserve assets when their asset-referenced tokens are classified as
significant asset-referenced tokens, either based on the criteria set out in Article 43 of
Regulation (EU) 2023/1114 or on a voluntary basis as envisaged in Article 44 of Regulation (EU)
2023/1114.
5. Significant asset-referenced tokens could be used by a large number of holders and their use
could raise specific challenges in terms of financial stability, monetary policy transmission or
monetary sovereignty, therefore, issuers of significant asset-referenced tokens should be
subject to more stringent requirements, also in terms of own funds.
6. Article 45(5) of Regulation (EU) 2023/1114 also apply to issuers of e-money tokes (either
significant or, where decided, non-significant), as per Articles 58(1), point (b), and (2) of
Regulation (EU) 2013/1114, of that Regulation. Therefore, these RTS should also be relevant and
applicable for those.
7. As specified in recital 44 and recital 71 of Regulation (EU) 2023/1114, credit institutions that act
as issuers of asset-referenced tokens or e-money tokens are not subject to own funds
requirements. Therefore, these RTS to adjust the amount of its own funds to 3% as required by
2
Article 45(7)(a) relates to an RTS on governance arrangement on renumeration policies and (b) to an RTS on liquidity
management policy and procedures.
5
paragraph 5 of Article 45 of Regulation (EU) 2023/1114 for significant asset-reference token is

not applicable to credit institutions.
3.1 Own funds requirements of issuers of significant asset-

referenced tokens
3.1.1 Procedure and timeframe
8. Within 25 working days from the classification of the asset-referenced token as significant asset-
referenced token, the competent authority should provide the issuer of the significant asset-
referenced token with the timeframe within which it should adjust its own funds. The issuer of
the significant asset-referenced token should then provide within 20 working days from the
notification the plan to adjust its own funds, which should include time-bound steps and
procedures to carry out the adjustment within the set timeframe and ensure that the funds
consist of the Common Equity Tier 1 items and instruments.
9. In order to ensure the effective and timely adjustment of own funds, the competent authority
should closely monitor the implementation of the plan by the issuer of the significant asset-
referenced token. Whenever necessary, the competent authority should be able to request
additional information, and in case the measures do not progress as initially planned, an
alternative course of action should be agreed.
10.When setting the timeframe for the issuer of a significant asset-referenced token to adjust its
own funds the competent authority should take into account the potential impact on the issuer
of the significant asset-referenced token and its specificities. In any case, the competent
authority should not grant the issuer of a significant asset-referenced token more than 3 months
to adjust its level of own funds.

6
7
of XXX

Council with regard to regulatory technical standards specifying the procedure and
timeframe for an issuer of a significant asset-referenced token or of e-money tokens
subject to such requirements to adjust the amount of its own funds set out in Article
45(5)
on Markets in Crypto-assets, and amending Regulations (EU) No 1093/2010 and (EU) No
1095/2010 and Directives 2013/36/EU and Directive (EU) 2019/1937 3, and in particular
Whereas:
(1) Considering that requirements set out in Articles 35, points (2), (3) and (5) and Article
45(5) of Regulation (EU) 2023/1114 also apply to issuers of e-money tokens (either
significant or, where decided, non-significant), as per Articles 58(1), point (b), and (2)
of that Regulation, this Regulation should also apply to issuers of e-money tokens that
are subject to or required to comply with those requirements.
(2) Issuers of asset-referenced tokens or e-money tokens once classified as significant or,
where applicable, in accordance with Article 58(2) of Regulation (EU) 2023/1114,
should elaborate a plan to adjust the level of own funds to the required level within the
timeframe required. Those should discuss and agree the feasibility of such plan with
the relevant competent authorities. Implementation of such plan should be closely
monitored by competent authorities and, for that purpose, issuers of asset-referenced
or, where applicable, e-money tokens should notify to the competent authority steps
taken, including a final notification of the adjustment completion.
(3) Competent authorities are well suited to determine the timeframe to adjust their own
funds for issuers of a significant asset-referenced or e-money tokens that becomes
subject to the requirement set out in Article 45(5) of Regulation (EU) 2023/1114. Such
timeframe should have a maximum deadline and, in principle, be as short as possible
and based on a case-by-case assessment, having regard to the potential impact on the
issuer of the significant asset referenced or, where applicable, e-money token, its
specificities and risks to the financial stability of the wider financial system.
3
(OJ L 150, 9.6.2023, p. 40–205).
8
European Parliament and of the Council, 4
Article 1
Procedure
1. Within 25 working days from the notification referred to either in Article 43(6) or
Article 44(3) of Regulation (EU) 2013/1114, the competent authority shall notify the
issuer of the significant asset-referenced token or, where applicable, the issuer of e-
money tokens issued by electronic money institutions the timeframe within which it
shall adjust its own funds to meet the requirements in Article 45(5) of that
Regulation.
2. Within 20 working days from receipt of the notification on the timeframe referred to
in paragraph 1, the issuer of the significant asset-referenced token or, where
applicable, the issuer of e-money tokens issued by electronic money institutions shall
submit to the competent authority a detailed plan on how its own funds will be
adjusted to meet the requirements in Article 45(5) of Regulation (EU) (EU)
2013/1114.
3. The plan referred to in paragraph 2 shall:
(a) include time-bound steps and procedures to carry out the own funds’ adjustment
within the timeframe set in article 2; and
(b) ensure that the funds consist of the Common Equity Tier 1 items and instruments
referred to in Articles 26 to 30 of Regulation (EU) No 575/2013 5 after the
deductions referred to in Article 36 of Regulation (EU) No 575/2013 have been
applied in full and the threshold exemptions referred to in Article 46(4) and
Article 48 of that Regulation have been disapplied, including a reference to the
composition of such items and instruments.
5
Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements
for credit institutions and amending Regulation (EU) No 648/2012 (OJ L 176 27.6.2013, p. 1).
9
4. The issuer of a significant asset-referenced token or, where applicable, the issuer of
e-money tokens issued by electronic money institutions shall inform the competent
authority immediately and in writing in case any step or procedure of the plan in
paragraph 2 cannot be achieved in a timely manner. In such a case, the said issuer
shall submit to the competent authority an update of the plan, including alternative
steps or procedures that allow the issuer to adjust its own funds in the set timeframe.
5. The competent authority shall closely monitor the implementation of the plan in
paragraph 2.
6. The issuer of the asset-referenced token or, where applicable, the issuer of e-money
tokens issued by electronic money institutions shall inform the competent authority
of the completion of the steps provided in the plan, including a final notification to
the competent authority when the required own funds adjustment has been
completed, within a maximum of 20 workings days as from the completion.
Article 2
Timeframe
1. When an issuer of asset-referenced token or, where applicable e-money token are
required to comply with the requirements set out in Article 45(5) of Regulation (EU)
2013/1114, the relevant issuer of such tokens shall adjust its own funds to meet the
requirements in Article 45(5) of that Regulation within the timeframe set by the
competent authority in Article 1(1).
2. In setting the timeframe referred to in Article 1(1), the competent authority shall not
grant more than 3 months as from the notification referred to in Article 43(6) or 44(3)
of Regulation (EU) 2023/1114 to the issuer of a significant asset-referenced token
or, where applicable, the issuer of e-money tokens issued by electronic money
institutions to adjust its own funds, having regard to the potential impact on the
relevant issuer, its specificities and risks to the financial stability of the wider
financial system.
Explanatory box:
Issuers that become ‘significant’ should follow a specific procedure when adjusting the
own funds. The procedure starts with the competent authority notifies the issuer the
timeframe within which it shall adjust its own funds to meet the requirements. The issuer
has 20 working days from receipt of the notification to submit to the competent
authority a detailed plan on how its own funds will be increased.
10
Questions for consultation:

Question 1. Is the procedure clear and the timelines for the issuer to submit the plan
reasonable?
Question 2. Are the timeframes for issuers to adjust to higher own funds requirements
feasible?
Question 3. During the period when own funds need to be increased by the issuer,
should there be more restrictions on the issuer to ensure timely
implementation of the additional own funds requirements, for example
banning the issuance of further tokens?
Article 3
Entry into force
Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
11
THE AMOUNT OF ITS OWN FUNDS REQUIREMENTS FOR ISSUERS OF SIGNIFICANT ASSET-REFERENCED TOKENS OR OF E-
MONEY TOKENS SUBJECT TO THE REQUIREMENTS IN ARTICLE 45(7)(5) OF REGULATION (EU) 2023/1114 ON MARKETS IN
CRYPTO-ASSETS

the potential costs and benefits of draft Regulatory Technical Standards. RTS developed by the
EBA shall therefore be accompanied by an Impact Assessment (IA) that analyses ‘the potential
related costs and benefits’.
2. This analysis presents the IA of the main policy options discussed and assessed in the
elaboration of the draft RTS on the procedure and timeframe for an issuer of significant asset-
referenced tokens to adjust the amount of its own funds, which the EBA is mandated to develop
under Article 45(7) of Regulation (EU) 2023/1114 6.
A. Problem identification and baseline scenario
3. Significant issuers of asset–referenced tokens would have a considerable market penetration

and be used by a large number of holders. As such, they could pose challenges in terms of
monetary policy transmission and monetary sovereignty, as well as the overall stability of the
financial system if they were not adequately capitalised. They should therefore be subject to
more stringent own-funds requirements than non-significant issuers. To ensure consistency
among the EU Member States, it is important that the set of rules regulating the procedure and
timeframe to adjust to these requirements is harmonised throughout the Union.
4. In the baseline scenario, issuers of significant asset-referenced tokens would be subject to own-
funds requirements as per Regulation (EU) 2023/1114, excluding any additional specification
provided by this RTS. In the absence of this harmonised set of rules, competent authorities may
adopt divergent approaches throughout the EU, which could jeopardise financial stability and
compromise the level-playing field among issuers and Member States.
5. The aim of this RTS is to provide competent authorities and significant issuers of asset-
referenced tokens with a harmonised procedure and timeframe for significant issuers to
adjust their amount of own funds when demanded by the competent authority.
6
requirements referred to in Article 45(5) of Regulation (EU) 2023/1114
12
CRYPTO-ASSETS
C. Policy options
General Approach
6. The EBA has adopted a prescriptive approach in outlining the procedure for significant issuers
to submit their compliance plan, while providing competent authorities with a relatively larger
degree of flexibility in setting the timeframe for significant issuers to adjust their amount of
own funds (up to 3 months).
Procedure and timeframe
7. In drafting this RTS, the EBA could have either adopted a rule-based approach (option A),
providing a detailed set of rules to be strictly followed by significant issuers and competent
authorities, or a principle- based approach (option B), leaving a high degree of flexibility to
competent authorities.
8. Under option A, issuers of significant asset-referenced tokens should follow a strict procedure
in adjusting their own funds when demanded by the competent authority. The steps of these
procedure would refer to a detailed timeframe, with little room for the competent authority to
adjust its requests to any potential specificities. This would favour an easy and harmonised
implementation throughout the Union, but could also lead to a lack of effectiveness given the
disregard to contingent circumstances.
9. Option B envisions a more flexible procedure for significant issuers and competent authorities
to follow, allowing the latter to adjust the timeframe within which the former should comply
to the new own-funds requirement. While this approach would enable competent authorities
to adjust their demands also based on contingent circumstances, it also risks to push them to
adopt divergent procedures across Member States, thus jeopardising the level-playing field in
the Union.
10. In both cases, the maximum timeframe within which significant issuers should be allowed to
adapt is shorter than for own funds adjustments for non-significant issuers under Article 35(6)
of MiCAR , given their potential to affect not only the market of asset-referenced tokens, but
also the stability of the overall financial system.
Preferred option
11. In determining the procedure and timeframe for issuers of significant asset-referenced tokens
to adapt to higher own-funds requirements, the preferred option is a combination of options
A and B.
12. On the one hand, the EBA has adopted a relatively strict procedure that competent authorities
and significant issuers must follow in adjusting own-funds requirements, providing a clear and
harmonised implementation framework. On the other hand, a reasonable degree of flexibility
is left to competent authorities in determining the timeframe for significant issuers to comply,
as long as it does not exceed 3 months. Within the limits ensuring supervisory convergence
13
CRYPTO-ASSETS
throughout the EU, this will allow competent authorities to adjust their demands also based on
the specificities that could apply to each case.

Question 1. Is the procedure clear and the timelines for the issuer to submit the plan
reasonable?
feasible?
implementation of the additional own funds’ requirements, for example
14
EBA Regular Use
CONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS ON ADJUSTMENT OF OWN FUNDS
REQUIREMENTS AND STRESS TESTING OF ISSUERS OF ASSET-REFERENCED TOKENS OR OF E-MONEY TOKENS
SUBJECT TO THE REQUIREMENTS IN ARTICLE 35 OF REGULATION (EU) 2023/1114 ON MARKETS IN CRYPTO-
ASSETS
EBA/CP/2023/28
08 NOVEBER 2023
Consultation Paper

to specify the adjustment of own funds requirements and stress
testing of issuers of asset-referenced tokens and of e-money tokens
subject to the requirements in Article 35 of Regulation (EU)
2023/1114 on markets in crypto-assets
1
EBA Regular Use
REQUIREMENTS AND STRESS TESTING OF ISSUERS OF ASSET-REFERENCED TOKENS OR OF E-MONEY TOKENS
SUBJECT TO THE REQUIREMENTS IN ARTICLE 35 OF REGULATION (EU) 2023/1114 ON MARKETS IN CRYPTO-
ASSETS
Contents
2
EBA Regular Use
REQUIREMENTS AND STRESS TESTING OF ASSET-REFERENCED TOKENS AND OF E-MONEY TOKENS SUBJECT
TO THE REQUIREMENTS IN ARTICLE 35 OF REGULATION (EU) 2023/1114 ON MARKETS IN CRYPTO-ASSETS

European Ombudsman.
Data protection
website.
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Pursuant to paragraph 1 of Article 35 of Regulation (EU) 2023/1114 issuers of asset-reference
tokens are subject to own funds requirements, and in accordance with paragraph 3 of the same
article competent authorities, following an assessment based on specific criteria, will be able to
increase the amount of own funds requirements of an issuer of asset-referenced tokens that is
deemed to have a higher degree of risk.
Moreover, issuers of asset-referenced tokens are required to conduct stress testing based on
plausible financial stress scenarios, and competent authorities will be able to increase the amount
of own funds requirements of an issuer of asset-referenced tokens having regard to the risk outlook
and stress testing results.
The mentioned requirements apply as well to electronic money institutions issuing e-money tokens
that are significant by virtue of Article 58(1), point b, of Regulation (EU) 2023/1114 and can be
expanded to e-money institutions issuing e-money tokens that are not significant if the competent
authority of the home Member State requires it so following Article 58(2) of that Regulation.
According to the mandate in Article 35(6) of Regulation (EU) 2023/1114, the EBA has developed
these Regulatory Technical Standards (RTS) 1 specifying the procedure and timeframe for an issuer
of an asset-referenced token to adjust to higher own funds requirements when this is deemed to
have a higher degree of risk, the criteria for competent authorities to follow during the assessment
of such higher degree of risk and the minimum requirements for the design of the stress testing
programmes.
Given the novelty of asset-referenced tokens and their issuers, the fact no universal risks
The EBA followed a more prescriptive approach when specifying the procedure for issuers of asset-
referenced tokens to submit a compliance plan, while provided more flexibility to competent
authorities on the timeframe to grant an issuer of an asset-referenced token to adjust to higher
own funds requirements (up to 1 year) and on the assessment of higher degree of risk criteria
(based on 3 criteria).
These draft RTS also provide general rules to be followed by issuers of asset-referenced tokens for
the design, implementation and use of stress testing programmes and methodology. These rules
will ensure a minimum level of consistency between issuers of asset-referenced tokens, while
ensuring they are proportional to their size, complexity, and business model.
For issuers of asset-referenced tokens to understand and model all risks they are exposed to,
including any possible interlinkages between the crypto-ecosystem and the traditional financial
sector stemming from reserve assets both a solvency and liquidity risk of issuers of asset-referenced
tokens stress test is necessary as a minimum, and to ensure that the results of the stress test remain
relevant, a minimum frequency of testing required. Furthermore, to assure that issuers of asset-
referenced tokens have sound risk management culture and practices rules on internal governance
and IT data infrastructure have been developed as well.
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requirements referred to in Article 35(2), (3) and (5) of Regulation (EU) 2023/1114
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Next steps
The final draft RTS will be submitted to the Commission for adoption. Following the submission, the
RTS will be subject to scrutiny by the European Parliament and the Council before being published
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1. Issuers of asset-referenced tokens issue those tokens that are a type of crypto-asset that is not
an electronic money token and that purports to maintain a stable value by referencing another
value or right or a combination thereof, including one or more official currencies. To address the
risks to financial stability of the wider financial system, issuers of asset-referenced tokens are
subject to own funds requirements 2 . Those requirements should be proportionate to the
issuance size of the asset-referenced tokens and therefore are to be calculated as a percentage
of the reserve of assets that back the value of the asset-referenced tokens.
2. Furthermore, to ensure consumer protection, issuers of asset-referenced tokens should also

comply with certain prudential requirements. As specified in recital 80 of Regulation (EU)
2023/1114, those prudential requirements are set as a fixed amount or in proportion to the
fixed overheads of crypto-asset service providers of the preceding year, depending on the types
of services they provide.
3. Article 35(1) of Regulation (EU) 2023/1114 introduces the own funds requirement for issuers of
asset-referenced tokens. Issuers of asset-referenced tokens, shall at all times have own funds
equal to an amount of at least the highest of:
a. EUR 350.000;
b. 2% of the average amount of the reserve assets (referred to in Article 36);
c. A quarter of the fixed overhead of the preceding year.
4. The 2% percentage shall be set at 3% of the average amount of the reserve assets for issuers of
significant asset-referenced tokens according to Article 45(5) of Regulation (EU) 2023/1114.
5. Article 35(3) of Regulation (EU) 2023/1114 specifies that competent authorities will be able to
increase the amount of own fund requirements of an issuer of asset-referenced tokens by up to
20%, above the requirements set in Article 35(1)(b) of Regulation (EU) 2023/1114, in case an
assessment of an issuer of asset-referenced tokens indicates a higher degree of risk in any of
the following points:
a. the evaluation of the risk-management processes and internal control mechanisms

of the issuer of the asset-referenced token as referred to in Article 34 (1), (8) and
(10);
b. the quality and volatility of the reserve of assets referred to in Article 36;
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Credit institutions authorised under Directive 2013/36/EU issuing asset-reference tokens, including significant asset-
referenced tokens, are not subject to these own funds requirements.
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c. the types of rights granted by the issuer of the asset-referenced token to holders
of the asset-referenced token in accordance with Article 39;
d. where the reserve of assets includes investments, the risks posed by the
investment policy on the reserve of assets;
e. the aggregate value and number of transactions settled in the asset-referenced

token;
f. the importance of the markets on which the asset-referenced token is offered and
marketed;
g. where applicable, the market capitalisation of the asset-referenced token.
6. Issuers of asset-referenced tokens are required to conduct on a regular basis stress-testing,

under Article 35(5) of Regulation (EU) 2023/1114 considering certain scenarios and parameters
and based on the outcome competent authorities shall in certain circumstances require issuers
of asset-referenced tokens to hold an amount of own funds which is between 20% and 40%
higher than the amount resulting from the application of Article 35(1)(b) of Regulation (EU)
2023/1114.
7. The EBA is mandated under Article 35(6) of Regulation (EU) 2023/1114, in close cooperation
with ESMA and the ECB, to develop draft regulatory technical standards further specifying:
a. the procedure and timeframe for an issuer of an asset-referenced token to adjust

to higher own funds requirements as set out in paragraph 3 of Article 35;
b. the criteria for requiring a higher amount of own funds as set out in paragraph 3 of
Article 35;
c. the minimum requirements for the design of stress testing programmes, taking into
account the size, complexity and nature of the asset-referenced token, including
but not limited to: (i) the types of stress testing and their main objectives and
applications; (ii) the frequency of the different stress testing exercises; (iii) the
internal governance arrangements; (iv) the relevant data infrastructure; (v) the
methodology and the plausibility of assumptions; (vi) the application of the
proportionality principle to all of the minimum requirements, whether quantitative
or qualitative; and (vii) the minimum periodicity of the stress tests and the common
reference parameters of the stress test scenarios.
8. Articles 35(2), (3) and (5) and Article 45(5) of Regulation (EU) 2023/1114 also apply to issuers of
e-money tokens (either significant or, where decided, non-significant), as per Articles 58(1),
point (b), and (2) of Regulation (EU) 2023/1114, of that Regulation. Therefore, these RTS should
also be relevant and applicable for those.
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9. The main purpose of these draft RTS is to specify how and when competent authorities shall
assess whether to require an issuer of asset-referenced tokens to increase the own funds
amount by providing criteria on how to assess the possible ‘higher risk’ of an issuer of asset-
referenced tokens.
10.These draft RTS also provide the procedure for competent authorities to determine the specific
period of time considered appropriate for an issuer of asset-referenced tokens to increase the
own funds amount to the new requirements and the measures to be taken to ensure the timely
compliance thereof.
11.Issuers of asset-referenced tokens, need to ensure robust and prudent reserve asset
management and operational requirements to instill confidence, to ensure the stability of the
peg and avoid a run on the token with possible contagion to the financial sector. Failures of
issuers of asset-referenced tokens could result in large-scale redemption and trigger a fire-sale
of their reserve assets as well as deposit withdrawal, potentially causing significant market
disruptions and systemic risks in the broader financial system.
12.As specified in recital 44 and recital 71 of Regulation (EU) 2023/1114, credit institutions that act
as issuers of asset-referenced tokens or e-money tokens are not subject to own funds
requirements. Therefore, these RTS for additional own funds requirements are not applicable
to credit institutions.
13.In case competent authorities requires additional own funds due to the assessment of a higher
degree of risk in accordance with Articles 35(3) of Regulation (EU) 2023/1114 and at the same
time requires additional own funds due to the stress test results and the risk outlook in
accordance with 35(5) of Regulation (EU) 2023/1114, the requirements are without prejudice of
each other as such both requirements should be applied cumulatively.
14.For the avoidance of doubt, these RTS are already applicable during the authorisation phase of
an issuer as specified in the RTS on information for application for authorisation to offer to the
public or to seek admission to trading of asset-referenced tokens under Article 18(6) of
Regulation (EU) 2023/1114 and therefor it is possible for competent authorities to require
additional own funds from the moment of the first issuance of tokens.
15.Separately for this mandate, EBA is also mandated to develop a draft RTS under Article 45(7)(c)
of Regulation (EU) 2023/1114 on the procedure and timeframe for issuers of significant asset-
referenced tokens to adjust their own funds amount of Regulation (EU) 2023/1114 from 2% to
3% of the reserve assets after an issuer becomes issuer of significant asset-referenced tokens.
Due to the similarities with the mandate under Article 35(6) of Regulation (EU) 2023/1114 and
to ensure consistency and to reduce the operational burden to issuers and competent
authorities , it is the intention to align the procedures as much as possible, where possible.
3.1 Own funds requirements of issuers of asset-referenced

tokens
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3.1.1 Own funds and quality of capital
16.Article 35(1) of Regulation (EU) 2023/1114 combines 3 different aspects of capital, initial capital
to start up a business, a going concern capital by a % based on the size of the business (reserve
assets) and a minimum requirement based on fixed overhead costs to cover for any potential
consumer protection issues. The minimum capital can be adjusted upwards by a competent
authority under certain conditions.
17.Furthermore, the composition/quality of own funds shall consist of the Common Equity Tier 1
items and instruments referred to in Articles 26 to 30 of Regulation (EU) No 575/2013 in
accordance with Art 35(2) of Regulation (EU) 2023/1114.
18.The mandate is about adjusting capital upwards mainly due to risk-management processes and
internal control mechanisms issues, risks in the investment portfolio, or due to possible financial
stability issues related to the size of the issuer of asset-referenced tokens. This is similar to a
Pillar 2 requirement under the banking regulation.
19.The additional own funds requirements coming from the application of Article 35(3) or
Article35(5) of Regulation (EU) 2023/1114should stay in place untill the competent authority
finds that the higher degree of risk does not require anymore a higher level of own funds.
3.1.2 ‘Higher’ own funds requirements
20.Article 35(3) of Regulation (EU) 2023/1114 specifies that competent authorities can increase the
amount of own funds requirements of an issuer of asset-referenced tokens by up to 20%, in
accordance with Article 35(1)(b) of Regulation (EU) 2023/1114, in case an assessment of an
asset-referenced token issuer indicates a higher degree of risk. Furthermore, Article 35(5) of
Regulation (EU) 2023/1114 specifies that competent authorities considering severe but
plausible financial stress scenarios and parameters and based on the outcome of the stress
testing conducted by the issuer of asset-referenced tokens shall in certain circumstances, also
considering the overall risk outlook, require issuers of asset-referenced tokens to hold an
amount of own funds which is between 20% and 40% higher than the amount resulting from the
application of Article 35(1)(b).
21.Article 35(6)(a) of Regulation (EU) 2023/1114 mandates the EBA to further specify; (a) the
procedure and timeframe for an issuer of an asset-referenced token with higher degree of risk
to adjust to higher own funds requirements and to specify (b) the criteria used during the
assessment of a higher degree of risk that leads to require a higher amount of own funds.
3.1.3 Procedure and timeframe
22. As required by Article 34(1) of Regulation (EU) 2023/1114 issuers of asset-referenced tokens
shall have robust governance arrangements, including a clear organisational structure with well-
defined, transparent and consistent lines of responsibility, effective processes to identify,
manage, monitor and report the risks to which they are or might be exposed, and adequate
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internal control mechanisms, including sound administrative and accounting procedures. Issuers
of asset-referenced tokens should at all times take measures to reduce the risks to which they
are exposed. In case these measures have insufficient effect, it should be considered to require
additional own funds.
23.Notwithstanding the above, the competent authority may determine the timeframe for an
issuer of asset-referenced tokens to adjust to higher own funds requirements when an issuer of
asset-referenced tokens is considered to have a higher degree of risk as referred to in Article
35(3).
24.Based on the assessment performed applying the criteria mentioned in this section, the
competent authority should be in the position to determine a timeframe considered appropriate
for an issuer of asset-referenced tokens to adjust to higher own funds requirements. In
particular, the competent authority should decide whether the adjustment should be completed
within 3 months, when the higher degree of risk indicates that this can have a material impact
on the financial situation of the issuer of asset-referenced tokens or on the financial stability of
the wider financial system, or is associated with the issuer of asset-referenced tokens’
governance or business model or whether it should grant the issuer of asset-referenced tokens
a longer period. In the latter case, by acknowledging that there could be extraordinary cases
that may warrant allowing a longer timeframe, competent authorities should not grant more
than 1 year to issuers of asset-referenced tokens to implement the measures needed to increase
the amount of own funds.
25.Competent authorities should take into account the issuer of asset-referenced tokens’ financial
situation and consider on a case-by-case basis whether the timeframe to implement certain
measures to adjust to higher own funds requirements should be corrected upwards or
downwards due to the potential impact on the financial situation of the issuer of asset-
referenced tokens or due to potential financial stability implications of not adjusting own fund
requirements fast enough. As a principle, increase in own funds amounts should be completed
with a short timeframe, but in any case, the maximum amount of time competent authorities
can grant to issuers of asset-referenced tokens to implement specific measures is 1 year. For
example, an issuer of asset-referenced tokens with a less favourable financial situation might
need more time to implement certain measures to comply with the requirements or otherwise
risks a worsening of the financial situation itself.
26.The same considerations apply when the assessment of an issuer of asset-referenced tokens’
reserve of assets reveals that these are not highly exposed to concentration risk, as defined in
Article 36 of Regulation (EU) 2023/1114. Indeed, in this case the competent authority might
allow a longer period to adjust the level of own funds since this could entail that the issuer of
asset-referenced tokens has incorporated a diversified risk management strategy as an
established practice.
27.It is incumbent upon issuers of asset-referenced tokens to present to the competent authority
a set of measures to ensure the timely adjustment to the higher own funds requirements. Such
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measures should be to the discretion of the competent authority with due regard to the
assessment performed in accordance with Article 35(3) of Regulation (EU) 2023/1114. In
assessing the appropriateness of the measures, the competent authority should consider
whether these would address for the higher degree of risk identified.
28.The issuer of asset-referenced tokens shall provide the competent authority with a plan to
compliance with Article 35(3) of Regulation (EU) 2023/1114. The set of measures included in the
plan shall include time-bound steps and procedures to carry out the increase within the set
timeframe and ensure that the funds consist of the Common Equity Tier 1 items and instruments
as referred to in Articles 26 to 30 of Regulation (EU) No 575/2013 after the deductions in full
pursuant to Article 36 of that Regulation, without the application of the threshold exemptions
referred to in Article 46(4) and Article 48 of that Regulation. In any case, the issuer of asset-
referenced tokens should always strive to identify and address any foreseeable risks or obstacle
to the effective and timely execution of the measures. If a period longer than 3 months is given
to implement the plan, the issuer of asset-reference tokens shall update competent authorities,
at least, on a monthly basis on the plan’s implementation progress.
29.The competent authority should consider whether the issuer of asset-referenced tokens should
employ further strategies to increase the own funds, considerations should also be given to
whether this could be achieved by means of issuing new capital items or retaining profits.
30.In order to ensure the effective and timely increase of own funds, the competent authority
should closely monitor the implementation of the plan by the issuer of asset-referenced tokens.
Whenever necessary, the competent authority should be able to request additional information,
and in case the measures do not progress as initially planned, an alternative course of action
might be required.
31.When the requirement to increase the own funds comes from lack of internal control and
inadequate risk management processes, the competent authority should assess those processes
and require specific measures to improve them, as well as to require the issuer of asset-
referenced tokens to perform an internal or external audit regarding its internal control and risk
management processes. Moreover, competent authorities could perform targeted on-site
examinations.
32.In defining and implementing the plan to increase the own funds, issuers of asset-referenced
tokens should consider that Article 34(3) of Regulation (EU) 2023/1114 requires the
management body of the issuer of asset-referenced tokens to assess and periodically review the
effectiveness of the policy arrangements and procedures and take appropriate measures to
address any deficiencies in that respect. Furthermore, it is the role of the issuer of asset-
referenced tokens’ management body, or internal audit committee or department, where
established, to monitor the effectiveness of the issuer of asset-referenced tokens’ internal
quality control and risk management systems and, where applicable, its internal audit function.
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33.Furthermore, the management body of an issuer of asset-referenced tokens should oversee the
implementation of the compliance plan, which should be communicated to all staff members.
Issuers of asset-referenced tokens should set up a process to regularly assess changes in the law
and regulations applicable to its activities. The compliance function, where established, should
advise the management body on measures to be taken to ensure compliance with applicable
laws, rules, regulations and standards, and should assess the possible impact of any changes in
the legal or regulatory environment on the issuer of asset-referenced tokens’ activities and
compliance framework.
3.1.4 Criteria
34.Given the novelty of issuers of asset-referenced tokens and the tokens themselves, no universal
assessment framework exists. This makes it difficult for competent authorities to evaluate the
risks of an issuer of asset-referenced tokens, its therefore crucial that competent authorities
have the flexibility to increase the own funds requirements of issuers of asset-referenced
tokens, if they observe a higher degree of risk. The higher degree of risk criteria specified in
Article 3 of these RTS should guide competent authorities in their decision and ensure a
harmonised approach across competent authorities in the EU.
35.Competent authorities should perform the evaluation on a case-by-case basis following a broad
assessment of all the criteria as specified in this Regulation when deciding if an increase in own
funds requirement is justified.
3.2 Stress-testing programmes

36.The significant increase in the size of asset-backed tokens has raised concerns about their
potential impacts on the financial system. Concerns with these tokens could result in large-scale
redemption and trigger a fire-sale of their reserve assets as well as deposit withdrawal,
potentially causing significant market disruptions and systemic risks across the financial system.
37.Issuers of assets referenced tokens need to ensure robust reserve asset management and
compliance with operational requirements to instill confidence, ensure the stability of the peg
and avoid a run on the token with possible contagion to the financial sector. Like money market
funds (MMFs), reserve assets of issuers of asset-referenced tokens need to be liquid to allow
users to redeem their tokens in fiat currency. Robust management of reserve assets underpins
users’ confidence in those tokens. A loss of confidence could trigger large-scale redemption
requests – especially if there are limited redemption possibilities– leading to the liquidation of
reserve assets with negative contagion effects on the financial system.
38.Article 35(5) of Regulation (EU) 2023/1114 envisages that issuers of assets referenced tokens
need to have in place and conduct a stress testing, on a regular basis. The stress testing should
take into account severe but plausible financial stress scenarios, such as credit, liquidity,
interest- and exchange rate shocks, market risk, and non-financial stress scenarios, such as
operational risk related shocks.
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39.Article 35(6)(c) of Regulation (EU) 2023/1114 further specifies that the EBA should set the
minimum requirements for the design of stress testing programmes, taking into account the
size, complexity and nature of the asset-referenced token issuer, including but not limited to (i)
the types of stress testing and their main objectives and applications; (ii) the periodicity and the
frequency of the different stress testing exercises; (iii) the internal governance arrangements;
(iv) the relevant data infrastructure; (v) the methodology and the plausibility of assumptions;
(vi) the application of the proportionality principle to all of the minimum requirements, whether
quantitative or qualitative; and (vii) the minimum periodicity of the stress tests and the common
reference parameters of the stress test scenarios.
40.Furthermore, these rules aim to achieve convergence of the practices followed by issuers of
asset-referenced tokens for stress testing across the EU. They provide detailed standards to be
complied with by issuers of asset-referenced tokens when designing and conducting a stress
testing programme/framework.
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of XXX

Council with regard to regulatory technical standards specifying adjusment of own
funds requirement and minimum features of stress testing programmes of issuers of
asset-referenced tokens or of e-money tokens subject to such requirements
Having regard to Regulation (EU) 2023/1114on Markets in Crypto-assets, and amending

Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and
Directive (EU) 2019/1937 3, and in particular Article 35(6), third subparagraph, thereof,
Whereas:
(1) When determining own funds requirements for issuers of asset-referenced tokens,
competent authorities have been granted with the flexibility to adjust upwards the
amount resulting from the application of paragraph 1, first subparagraph, point (b) of
that Article, which consists of 2% (or 3 % for significant tokens) of the average amount
of the reserve of assets, when certain circumstances indicate higher risks. When
assessing those circumstances, the impact a failure of the tokens could have on
financial stability should be considered, including large-scale redemptions, trigger of
fire-sales of reserve assets or deposit withdrawals, potentially causing significant
market disruptions, possible negative consequences for funding, and systemic risks
across the financial system. The former has been considered in this Regulation when
determining the criteria for requiring higher own funds.
(2) Considering that requirements set out in Articles 35, points (2), (3) and (5) and Article
45(5) of Regulation (EU) 2023/1114 also apply to issuers of e-money tokens (either
significant or, where decided, non-significant), as per Articles 58(1), point (b), and (2)
of that Regulation, this Regulation should also apply to issuers of e-money tokens that
are subject to or required to comply with those requirements.
(3) Given the novelty of asset-referenced and e-money tokens and their issuers, no
universal risks assessment framework exists. This makes it difficult for competent
authorities to evaluate the risks of and posed by those issuers. Therefore, when
deciding if an increase in own funds requirement is justified, competent authorities
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(OJ L 150, 9.6.2023, p. 40–205).
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should perform the evaluation on a case-by-case basis following a broad assessment

of all the criteria as specified in this Regulation. Requiring a possible increase to the
own funds requirements depends on issuer-specific circumstances, issuers of asset-
referenced tokens and issuers of e-money tokens -issued by electronic money
institutions- subject to such own funds requirements should always be adequately
capitalised for the risks they face. All relevant historical and current information
available should be used for the said broad assessment. Generally, increases in own
funds requirements should only be requested when there is a higher degree of risk,
which is not already covered, and the measures of the relevant issuer are insufficiently
effective to reduce the risks.
(4) In case a competent authority requires an increase in own funds requirements, the
timeframe provided to comply with such increase should be as short as possible since
a relevant issuer, applying a proper and effective risk management, should have
foreseen and thus prevented this measure. Exceptionally, if such issuers had not been
able to foresee or prevent the increase as the reasons for the increase lay outside such
issuers’ control, a longer timeframe may be considered.
(5) Where a competent authority concludes that the risks including volatility of a particular
asset-referenced token or, where applicable, e-money token might lead to a significant
deterioration of the financial situation of the relevant issuer or impact the financial
stability, the competent authority should require a shorter timeframe for the relevant
issuer to increase the own funds, requiring that the latter provides a set of measures to
execute the increase. While, in other cases, the timeframe should be longer requiring
the relevant issuer to submit a plan to increase the own funds. However, such issuer
should always discuss and agree with the competent authority a set of measures to
restore compliance. Such measures should be to the discretion of the competent
authority with due regard to the assessment performed for determining the higher own
funds requirements. In assessing the appropriateness of the measures, the competent
authority should also consider whether they would mitigate the higher degree of risk
observed in the near future.
(6) To ensure that issuers of asset-referenced tokens and, where applicable, issuers of e-
money tokens make risk management decisions that are in line with the expectations
of competent authorities, such issuers and competent authorities should understand the
financial and operational risks that come with increased use of asset-referenced and e-
money tokens. In addition, they should understand and consider interlinkages with
crypto-ecosystem more broadly and inherent interconnectedness with the traditional
financial sector stemming from reserves assets held. Therefore, stress testing the
solvency and liquidity risk of issuers of asset-referenced tokens and, where applicable,
issuers of e-money tokens is necessary.
(7) The impact of the so called ‘run-risk’ whereby a sudden spike in redemption requests
of the tokens, resulting in a fire sale of the reserve assets backing the tokens, needs to
be analysed via liquidity stress-testing. It is, therefore, essential to specify minimum
features of the liquidity stress-testing too, such as those related to governance, data
infrastructure, risk categorisation and frequency.
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(8) To ensure that the results of the stress test remain relevant, the minimum frequency for
solvency stress test should be at least, quarterly for issuers of significant asset-
referenced and e-money tokens issued by electronic money institutions. Such
frequency should be semi-annual for issuers of non-significant asset-referenced tokens
and, where applicable, e-money tokens issued by electronic money institutions.
Frequency for the liquidity stress test should be in any case at least monthly.
(9) The stress testing should consider severe but plausible financial stress scenarios and
non-financial stress scenarios, such as liquidity shocks, credit shocks, interest rate- and
exchange shocks, redemption risk and operational and third party shocks and ensure
that the internal governance arrangements and the relevant data infrastructure are in
place to allow issuers of asset-referenced tokens and, where applicable, of e-money
tokens and competent authorities to understand the characteristics, quantify risks and
gather evidence that such issuers are effectively allocating and mitigating risk on an
ongoing basis.
(10) As a guiding principle, the stress-testing programmes should follow the same business,
same risks and controls, and therefore similar rules and approach as to credit
institutions stress testing under Directive 2013/36/EU 4. However, considering that the
crypto-asset activities -provided by issuers of asset-referenced and e-money tokens-
and their risks are different to those of credit institutions it is necessary to group the
crypto-activities into different risk categories for the purpose of the stress-testing.
Furthermore, grouping the crypto-activities and risks ensures that issuers of asset-
referenced tokens, and where applicable e-money tokens, and competent authorities
can identify all the functions, processes, and actors, along with their associated risks
including any environmental, social, and governance factors, and identify red flags.
These identifications should facilitate the design and assignment of specific risk
scenarios presented in the different activities of the relevant issuer. The scenarios need
to be well-defined to quantify their potential impact, the range of potential losses and
the range of plausibility associated with the specific risk scenarios identified.
Therefore, when identifying specific risks, the relevant issuer must specify the time
horizon of the stress scenario, which should be three years for the solvency stress test
and up to one year for the liquidity stress test, the type of asset under stress and the
narrative of the stress scenario.
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Institutions and the prudential supervision of credit institutions, amending Directive 2002/87/EC and repealing Directives
2006/48/EC and 2006/49/EC Text with EEA relevance (OJ L 176, 27.6.2013, p. 338–436).
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European Parliament and of the Council, 5
Article 1
Procedure
1. Prior to finalising the determination referred to in Article 35 (3) of Regulation (EU)

2023/1114, competent authorities shall make available to the issuer of asset-
referenced tokens or, where applicable, the issuer of e-money tokens issued by
electronic money institutions, a relevant draft thereof and take due account of any
views expressed by such issuer.
2. The draft shall set out:
(a) the amount by which the own funds must be increased and the percentage higher
than the amount resulting from the application of paragraph 1, first
subparagraph, point (b) of reserve asset in Article 35 of Regulation (EU)
2023/1114 ;
(b) relevant reasoning as to the higher degree of risk;
(c) whether that higher degree of risk can have a material impact on the financial
situation of the issuer of asset-referenced tokens or on the financial stability of
the wider financial system;
(d) whether that higher degree of risk can be seen as not directly associated with the
relevant issuer’s governance or business model;
(e) the timeline within which the relevant issuer shall increase its own funds in
accordance with Article 2.
3. The issuer of asset-referenced tokens or, where applicable, the issuer of e-money
tokens issued by electronic money institutions shall be provided with 25 working
days within which it may express its views on any of the elements referred to in
paragraph 2, points (a) to (e).
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4. The competent authority shall notify the issuer of asset-referenced tokens or, where
applicable, the issuer of e-money tokens issued by electronic money institutions with
the final determination of the elements set out in paragraph 2 (a) to (e).
5. Within 20 working days from receipt of the notification referred to in paragraph 4,

the issuer of asset-referenced tokens or, where applicable, the issuer of e-money
tokens issued by electronic money institutions shall submit to the competent
authority detailed plan on how its own funds will be increased within the timeline set
by the competent authority.
6. The plan referred to in paragraph 5 shall:
(a) include time-bound steps and procedures to carry out the increase within the set
timeframe; and
(b) ensure that the funds consist of the Common Equity Tier 1 items and instruments
referred to in Articles 26 to 30 of Regulation (EU) No 575/2013 after the
deductions referred to in Article 36 of Regulation (EU) No 575/2013 have been
applied in full and the threshold exemptions referred to in Article 46(4) and
Article 48 of that Regulation have been disapplied, including the composition.
7. Where the timeframe set for the completion of the increase of own funds is longer
than three months, the issuer of asset-referenced tokens or, where applicable, the
issuer of e-money tokens issued by electronic money institutions shall update
competent authorities on a monthly basis on the plan’s implementation progress.
8. The issuer of asset-referenced tokens or, where applicable, the issuer of e-money
tokens issued by electronic money institutions shall inform the competent authority
immediately in case any step or procedure cannot be achieved in a timely manner.
9. Competent authorities shall closely monitor the implementation of the plan.
10. Where a college referred to in Article 119(1) of Regulation (EU) 2023/1114 has been
set up, the competent authority shall keep EBA informed of all the information
referred to in paragraphs 2 to 9, including the draft and the final determination, the
plan and its relevant updates.
Article 2
Timeframe
1. Where, on the basis of the assessment referred to in Article 35 (3) of Regulation (EU)
2023/1114, the higher degree of risk can have a material impact on the financial
stability of the wider financial system or of the issuer of asset-referenced tokens or,
where applicable, of e-money tokens issued by e-money institutions, or it results
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from deficiencies in relevant issuer’s governance or business model, such issuer shall
complete the increase of its own funds within three months. The competent authority
may set a shorter timeframe when this is justified by the materiality of the anticipated
impact.
2. Where the higher degree of risk does not have a material impact on the financial
situation of the issuer of asset-referenced tokens or, where applicable, the issuer of
e-money tokens issued by electronic money institutions, the increased risk does not
result from deficiencies on the relevant issuer’s governance or business model and
the increased risk does not pose financial stability concerns, the competent authority
may set a timeframe that cannot exceed one year.
Explanatory box:
Issuers should follow a specific procedure when adjusting the own funds to meet the
higher requirements set by the competent authority. The procedure starts with the
competent authority make available a draft of the assessment to the issuer, after which
the issuer has 25 working days to provide comments. After this period, the competent
authority notifies the issuer of the tokens with the final assessment, which has up to 20
working days to prepare a plan to increase the own funds.

Question 1. Is the procedure clear and the timelines for the issuer to provide views on
the assessment and submit the plan reasonable?
feasible?
Article 3
Criteria
When making the determination referred to in Article 35 (3) of Regulation EU

2023/1114, the competent authority shall apply all of the following criteria:
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(a) whether the issuer of asset-referenced tokens or, where applicable, the issuer
of e-money tokens issued by electronic money institutions is likely to breach
the requirements referred to in Articles 34 or 36 to 39 of Regulation (EU)
2023/1114 within the following 12 months;
(b) whether at-all-times redemption at par value and market value is not ensured
either in normal or in stressed conditions;
(c) whether there is an increased risk of a significant deterioration of the value of
the reserve assets or the financial situation of the issuer of asset-referenced
tokens or, where applicable, the issuer of e-money tokens issued by electronic
money institutions or an increased risk arising from systems including the
underlying distributed ledger and any trading platform, market infrastructure
or payment system used for the issuance or the transfer of the asset-referenced
token and from other third party crypto assets service providers such as
custodians to which the tokens and/or reserve assets might rely on;
To apply the criteria referred to in paragraph, point (a) competent authorities shall
assess whether there are potential deficiencies or weaknesses of the issuer of asset-
referenced tokens or, where applicable, the issuer of e-money tokens issued by
electronic money institutions with regard to the application of the requirements set
out in Article 34 and in Articles 36 to 39 of Regulation (EU) 2023/1114.
Explanatory box:
To assess whether an issuer has a higher degree of risk competent authorities should
consider a set of criteria that identify potential deficiencies or weaknesses. As per Recital
2, competent authorities should perform the evaluation on a case-by-case basis
following a broad assessment of all the criteria as specified in this Regulation.

Question 4. Do you agree with the criteria to identify if an issuer has a higher degree
of risk?
Question 5. Do you agree with the procedure to assess whether an issuer has a higher
degree of risk?
Question 6. Do you consider the criteria and their evaluation benchmarks sufficiently
clear?
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Article 4
Design of stress testing programme
1. Issuers of asset-referenced tokens or, where applicable, issuers of e-money tokens

issued by electronic money institutions shall have in place a stress testing programme
which covers at least the minimum requirements set out in Article 35(6)(c) of
Regulation (EU) 2023/1114, as specified in this Regulation.
issued by electronic money institutions shall ensure that their stress testing
programme is workable and feasible, and that stress testing results inform decision-
making at all appropriate management levels on all existing and potential risks
having material impact on the financial situation of the issuer.
issued by electronic money institutions shall regularly assess their stress testing
programme to determine its effectiveness, robustness and suitability to the features
of the issuer itself and token issued and shall keep it updated. This assessment shall
be made on at least an annual basis and shall fully reflect the external and internal
conditions.
4. When assessing the design of the stress testing programme, issuers of asset-
referenced tokens or, where applicable, issuers of e-money tokens issued by
electronic money institutions shall consider all the following elements:
a) the effectiveness of the programme in meeting its intended purposes;
b) the need for improvements;
c) the identified risk factors, reasoning for and design of relevant scenarios, model
assumptions and the sensitivity of results to these assumptions, as well as the role of
expert judgement to ensure that it is accompanied by sound analysis;
d) the model performance, including its performance on out-of-sample data, such as
data that were not used for model development;
e) how to incorporate possible solvency-liquidity adverse loops;
f) the adequacy of possible interlinkages between solvency stress tests and liquidity
stress tests;
g) feedback received from competent authorities in the context of their supervisory
or other stress tests;
h) the adequacy of the data infrastructure (systems implementation and data quality);
i) the appropriate level of involvement of senior management and the management
body;
j) all assumptions including business and/or managerial assumptions, and
management actions envisaged, based on the purpose, type and result of the stress
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testing, including an assessment of the feasibility of management actions in stress

situations and a changing business environment; and
k) the adequacy and transparency of the relevant documentation.
5. The stress testing programme shall be appropriately documented for all types of
stress tests carried out.
6. The stress testing programme shall be challenged across the organisation, for
instance by the risk committee and internal auditors. Business units not responsible
for the design and application of the programme or non-involved external experts
shall play a key role in the assessment of this process, taking into account the relevant
expertise for specific subjects.
7. Issuers of asset-referenced tokens or, where applicable, the issuer of e-money tokens
issued by electronic money institutions shall ensure, both for the initial design and
for the assessment of the stress testing programme, that an effective dialogue has
taken place with the involvement of experts from all business areas of the issuer of
asset-referenced tokens and that the programme and its updates have been properly
reviewed by the senior management and management body of the issuer of asset-
referenced tokens, who are also responsible for monitoring its execution and
oversight.
Article 5
Type of stress testing
1. Issuers of asset-referenced tokens or, where applicable, the issuer of e-money tokens
issued by electronic money institutions shall, at least, implement a solvency stress
test and a liquidity stress test.
2. The solvency stress test shall capture the impact of certain developments including
macro or microeconomic scenarios, on the overall capital position of the issuer of
asset-referenced tokens or, where applicable, the issuer of e-money tokens issued by
electronic money institutions, including on its minimum or additional own funds
requirements, by means of projecting the issuers of asset-referenced tokens’ capital
resources and requirements, highlighting the issuer of asset-referenced tokens’ or,
where applicable, the issuer of e-money tokens issued by electronic money
institutions vulnerabilities and assessing its capacity to absorb losses and the impact
on it solvency positions.
3. The liquidity stress test shall capture the impact of certain developments including
macro- or microeconomic scenarios, from a funding and market risk perspective and
shocks to the liquidity of the reserve of assets and to the overall liquidity position of
the issuer of asset-referenced tokens or the issuer of e-money tokens issued by
electronic money institutions, including to its minimum or additional requirements.
4. The specific design, complexity and level of detail of the stress test methodologies
shall be appropriate to the issuer of asset-referenced tokens’ or the issuer of e-money
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tokens issued by electronic money institutions nature, including redemption rights’

nature, scale and size, as well as the complexity, concentration and composition of
its reserve assets.
Article 6
Minimum periodicity and frequency of the different stress testing exercises
Minimum frequency for solvency stress test shall be, at least, quarterly for issuers of
significant asset-referenced tokens or, where applicable, the issuers of significant e-
money tokens issued by electronic money institutions. Frequency shall be, at least,
semi-annual for such issuers.
Minimum frequency of liquidity stress test shall be, at least, on a monthly basis for
all issuers of asset-referenced tokens or, where applicable, for issuers of e-money
tokens issued by electronic money institutions.
Article 7
Internal governance arrangements under the stress testing exercises
1. The stress testing programme of the issuer of asset-referenced tokens or, where
applicable, the issuer of e-money tokens issued by electronic money institutions shall
be adopted by its management body, which shall be responsible for its
implementation in accordance with Regulation (EU) 2023/1114 and this Regulation.
2. The stress testing programme shall include an assessment as to whether the members
of the management body have sufficient knowledge, skills and experience to perform
all of the following:
(a) fully understand the impact of stress events on the overall risk profile of the issuer
of asset-referenced tokens or, where applicable, the issuer of e-money tokens issued
by electronic money institutions.
(b) ensure that clear responsibilities and sufficient resources (such as skilled human
resources and information technology systems) have been assigned and allocated for
the execution of the stress tests;
(c) actively engage in discussions with staff involved in stress testing and with
persons to whom tasks related to stress testing are outsourced;
(d) challenge key modelling assumptions, the scenario selection and the assumptions
underlying the stress tests in general;
(e) decide on the necessary management actions and discuss them with the competent
authorities.
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3. The stress testing programme shall be designed in a way which allows stress tests to
be executed in accordance with the relevant internal policies and procedures of the
issuer of asset-referenced tokens or, where applicable, the issuer of e-money tokens
issued by electronic money institutions.
issued by electronic money institutions shall ensure that all elements of the stress
testing programme, including its assessment, are appropriately documented and
regularly updated, where relevant, in the internal policies and procedures.
issued by electronic money institutions shall ensure that the stress testing programme
design foresees an effective communication across business lines and management
levels, with a view to raising awareness, improving risk culture and instigating
discussions on existing and potential risks as well as on possible management
actions.
6. The stress testing programme shall be designed as an integral part of an issuer of
asset-referenced tokens or, where applicable, an issuer of e-money tokens issued by
electronic money institutions risk management framework. Stress tests shall be
designed to support different business decisions and processes as well as strategic
planning. The strategic decisions shall take into account the shortcomings,
limitations and vulnerabilities identified during stress testing.
7. The outputs of stress tests shall be used as inputs to the process of establishing an
issuer of asset-referenced tokens or, where applicable, issuer of e-money tokens
issued by electronic money institutions risk appetite and limits and shall act as a
planning tool to determine the effectiveness of new and existing business strategies
and assess the possible impact on own funds and liquidity.
Article 8
Relevant data infrastructure for stress testing programmes

issued by electronic money institutions shall ensure that the stress testing programme
is supported by an adequate and transparent data infrastructure.
issued by electronic money institutions shall ensure that their data infrastructure has
the capacity to capture the extensive data needs of their stress testing programme and
that they have in place mechanisms to ensure a continuous and consistent ability to
conduct stress testing as planned in accordance with the programme.
issued by electronic money institutions shall ensure that the data infrastructure allows
for both flexibility and appropriate levels of quality and control.
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issued by electronic money institutions shall ensure that their data infrastructure is
proportionate to their size, complexity, and risk and business profile, and allows for
the performance of stress tests covering all material risks that the institution is
exposed to.
issued by electronic money institutions shall devote sufficient human, financial and
material resources to guarantee the effective development and maintenance of their
data infrastructure, including information technology systems.
Article 9
Methodology, common reference parameters and the plausibility of assumptions

issued by electronic money institutions shall identify the following risks categories:
a. risks to the value, transferability, liquidity, accessibility or exchangeability of
the asset-referenced and reserve assets;
b. risks arising from systems, to which the asset-referenced relies, including the
underlying distributed ledger or any other technology of the token and any
trading platform, market infrastructure or payment system used for the
issuance or the transfer of the asset-referenced;
c. risks arising from the performance of contractual arrangements, which the
relevant issuer has entered into with other issuers, CASPs, financial
institutions or any other natural or legal person, for the issuance or transfer of
the asset-referenced tokens or for the establishment, management, custody or
investment of the reserve assets, including any arrangement whereby the
issuer outsources tasks.
2. To assess the risks referred to in paragraph 1, issuers of asset-referenced tokens or
or, where applicable, issuers of e-money tokens issued by electronic money
institutions shall identify specific risk scenarios using historical scenarios and/or
hypothetical scenarios in relation to the different risk categories referred to in
paragraph 1.
3. The specific risk scenarios referred to in paragraph 2 shall be well-defined and their
potential impact shall be quantifiable.
4. When identifying specific risks, issuers of asset-referenced tokens or, where
applicable, issuers of e-money tokens issued by electronic money institutions shall
specify a time horizon for 3 years for the risk events relating to the solvency stress
test and up to 1 year for the liquidity stress test, the asset at risk and a precise
description of the risk scenario.
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issued by electronic money institutions shall quantify the severity and plausibility of
the stress scenarios identified as well as the potential losses coming from those
scenarios.
Explanatory box:
Issuers should have in place and run periodically stress tests on solvency and liquidity.
The stress testing should consider severe but plausible financial stress scenarios and non-
financial stress scenarios and operational and third party shocks and ensure that the
internal governance arrangements and the relevant data infrastructure are in place to
allow issuers and competent authorities to understand the characteristics, quantify risks
and gather evidence that issuers are effectively allocating and mitigating risk on an
ongoing basis.

Question 7. Do you agree with the need for a solvency and liquidity stress-test and the
requirements of the stress-test?
Question 8. Do you agree with the frequency and time horizon of the solvency and
liquidity stress-test? Should there be more differentiation between
significant and not-significant issuers? Should the stress testing be more
frequent for issuers of asset-referenced tokens referenced to official
currencies?
Question 9. Should a reverse stress testing requirement/methodology be introduced?
Please provide your reasoning.
Question 10. Do you have any other comments in relation to the stress-testing part in
these RTS?
Article 10
Entry into force
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Done at Brussels,
For the Commission

The President
[For the Commission

[Position]
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ONSULTATION PAPER ON DRAFT REGULATORY TECHNICAL STANDARDS ON ADJUSTMENT OF OWN FUNDS

the potential costs and benefits of draft Regulatory Technical Standards. RTS developed by the
EBA shall therefore be accompanied by an Impact Assessment (IA) that analyses ‘the potential
related costs and benefits’.
2. This analysis presents the IA of the main policy options discussed and assessed in the
elaboration of the draft RTS on additional own funds requirements and stress testing, which
the EBA is mandated to develop under Article 35(6) of Regulation (EU) 2023/1114 6. Given the
novelty of asset-referenced tokens and their issuers no universal risks assessment framework
exists, it is difficult to evaluate the risks of and posed by issuers of asset-referenced tokens
under the different policy options, therefore a more principle based approach has been used.
A. Problem identification and baseline scenario
3. Issuers of asset-referenced tokens are required to hold a minimum amount of own funds, which
can be increase based on the assessment of higher degree of risk conducted by the competent
authority or on the results of the stress testing. During the assessment of the higher degree of
risk the criteria that competent authorities need to consider and the higher amount of own
funds that could require might change based on a series of features, such as the
comprehensiveness of the assessment, the scope and frequency of the assessment, as well as
the specific financial situation of the issuer of asset-referenced tokens.
4. On the other hand, the minimum requirements that the stress testing programmes should have
as well as their minimum frequency should take into account the operational burden upon
issuers of asset-referenced tokens when many types of stress tests are required, while at the
same time ensuring the relevance of the results, the proportionality aspects when a minimum
frequency is imposed and the feasibility of the stress test.
5. In the baseline scenario, issuers of asset-referenced tokens would be subject to own-funds
requirements and stress-testing obligations as specified in Regulation (EU) 2023/1114,
excluding any additional specifications in the form of an RTS. This could lead to divergent
approaches across competent authorities on the procedures and timeframes for an issuer of
asset-referenced tokens to adjust to higher own-funds requirements, as well as divergent
criteria when assessing a ‘higher degree of risk’. Finally, it would also lead to differences in the
6
requirements referred to in Article 35(2), (3) and (5) of Regulation (EU) 2023/1114
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stress testing programmes and methodologies due to lack of minimum harmonised

requirements specified by these RTS.
6. Such a limited legal framework could negatively impact the level playing field among issuers of
asset-referenced tokens and Member States. Above all, it could lead to financial instability if a
negative shock materialised and issuers of asset-referenced tokens had not adequately
assessed their own-funds requirements or solvency and liquidity status. The negative effects of
this scenario would be magnified as the relevant market develops.
7. The purpose of these draft RTS is i) to specify how competent authorities should decide when
requiring an issuer of asset-referenced tokens to increase the own funds amount by providing
criteria on how to assess the possible higher risk of an issuer of asset-referenced tokens, ii) to
provide issuers of asset-referenced tokens and competent authorities an harmonised
procedure and timeframe to follow when a higher amount of own funds has been required and
iii) to specify the minimum requirements of the stress testing programmes that all issuers of
asset-referenced tokens would need to put in place.
C. Policy options
General approach
8. Given the novelty of asset-referenced tokens and their issuers, the fact no universal risks
9. The EBA followed a more prescriptive approach when specifying the procedure and for issuers
to submit a compliance plan, while providing more flexibility to competent authorities on
timeframe for an issuer of an asset-referenced token to adjust to higher own funds
requirements (up to 1 year) and on the assessment of higher risk criteria (based on 3 criteria).
10. These draft RTS also provides general rules to be followed by issuers of asset-referenced tokens
for the design, implementation and use of stress testing programmes and methodology. These
rules will ensure a minimum level of consistency between issuers, while ensuring they are
proportional to the size, complexity, and business model of the issuers.
11. For issuers of asset-referenced tokens to understand and model all risks they are exposed to,
including any possible interlinkages between the crypto-ecosystem and the traditional financial
sector stemming from reserves assets both a solvency and liquidity risk of issuers of asset-
referenced tokens stress test is necessary as a minimum, and to ensure that the results of the
stress test remain relevant, a minimum frequency of testing required. Furthermore, to assure
that issuers of asset-referenced tokens have sound risk management culture and practices rules
on internal governance and IT data infrastructure have been developed as well.
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Procedure and timeframe
12. Overall, the EBA had the choice to create very detailed rules following a prescriptive approach
(Policy option A) or provide guidance and flexibility to issuers and competent authorities
following a more principles-based approach (Policy option B).
13. When issuers of asset-referenced tokens are required to increase the amount of own funds
under policy option A they should follow a precise procedure, fully harmonised across the EU.
This would include the specification of precise steps and timeframes that competent
authorities and issuers of asset-referenced tokens would follow, following a rule-based
approach.
14. Under this policy option the implementation of the procedure and timeframe would be easy,
the operational burden for both competent authorities and issuers of asset-referenced tokens
would be reduced, and a supervisory convergence would be ensured.
15. Policy option B would include the specification of a general procedure that competent
authorities and issuers of asset-referenced tokens would need to follow, allowing for flexibility
in the specification of the timeframe to increase the own funds.
16. While this option would allow competent authorities to adapt the procedure and timeframe to
the specificities of the issuers of asset-referenced tokens it would not guarantee a good amount
of harmonisation across the EU, creating possible comparative advantages (disadvantages)
when the competent authority is more (less) lenient.
Definition of criteria for higher degree of risk

Policy option A
17. During the assessment of higher degree of risk carried out by the competent authority the
criteria to establish weather an issuer of asset-referenced tokens is subject to a higher degree
of risk under this option would be specific, composed by a list of risks to be assessed.
18. Policy option A would produce one criterium to be assess by the competent authority for each
point in Article 35(3) of Regulation (EU) 2023/1114.
19. This comprehensive approach would reduce the operational burden of the competent
authority, as the assessment of higher degree of risk of the issuer of asset-referenced tokens
would be carried out via a sort of check list of items and would ensure a high level of
harmonisation across the EU. At the same time, this method could be less effective than
expected, as some issuers of asset-referenced tokens, given their specific business models,
might be exposed to a higher degree of risk due to issues not included in the list of criteria.
Policy option B
20. Under policy option B the assessment of higher degree of risk would follow a case-by-case
approach following a broad assessment of all the criteria as specified in this Regulation. This
would include assessing whether the issuer of asset-referenced tokens is likely to breach other
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requirements within a certain amount of time, whether the right of at-all-times redemption at
par value and market value is not ensured either in normal or in stressed conditions and
whether there is an increased risk of a significant deterioration of the value of the reserve assets
or the financial situation of the issuer of asset-referenced tokens.
21. This approach would still set a minimum level of harmonisation across the EU, while at the
same time ensuring some level of flexibility during the assessment of higher degree of risk, as
the criteria to focus on would be adapted by the competent authority based on the specificities
of the issuer of asset referenced tokens.
Minimum stress testing requirements
Policy option A
22. While setting the minimum requirements for stress testing programmes that issuers of asset-
referenced tokens should have in place under policy option A the purpose of such stress testing
has to been considered. A liquidity stress test is already included as mandatory in Regulation
(EU) 2023/1114, Article 35(5) also specifies that competent authorities may require issuers of
asset referenced tokens to increase their own funds based on the outcome of the stress testing,
would therefore make sense to include a solvency stress test as a minimum, as this would
ensure that the issuer of asset-referenced tokens is well capitalised.
23. Setting as minimum requirements a liquidity stress test and solvency stress test would ensure
robust reserve asset management and operational requirements to instil confidence, ensure
the stability of the peg and avoid a run on the token with possible contagion to the financial
sector.
24. Under this policy option proportionality would be taken into account requiring issuers of
significant asset-referenced tokens to conduct solvency stress test at least quarterly, while on
semi-annual basis for issuers of non-significant asset-referenced tokens. In this way, the
operational burden upon issuers of non-significant asset-referenced tokens is reduced, while
the solvency of issuers of significant asset-referenced tokens is monitored closely, as their
effect on the overall financial system during stress might be larger.
Policy option B
25. Policy option B would be identical to policy option A but it would introduce more types of stress-
testing such as; a reverse stress testing and/or operational risk stress-testing as a minimum.
26. Under this option additional scenarios and circumstances that might produce future risk for the
issuer of asset-referenced tokens would be stressed, but at the same time would create a
material operational burden and considered in conjunction with other management practices.
Overall cost-benefit analysis
27. Relative to the baseline scenario, the measures introduced by these draft RTS entail moderate
costs and large benefits. In terms of costs, issuers of asset-referenced tokens and competent
authorities would have to bear any incremental costs associated with the implementation of
all the minimum requirements for stress testing programmes. The issuer of asset-referenced
tokens would also incur larger compliance costs, while the competent authority would incur
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higher supervisory costs through time. Nevertheless, the RTS weigh very carefully these costs,
and tries to minimise them when the size of the issuers of asset-referenced tokens does not
justify more burdensome measures.
28. In terms of benefits, the harmonisation of the legal framework regulating issuers of asset-
referenced tokens would ensure a level playing field, which until now had to rely on national
regulations, if present. This should incentivise a more effective risk management through the
application of the stress testing procedures introduced by the legislators, and ensure that the
development of issuers of asset-referenced tokens is compliant with the conditions needed to
preserve financial stability. In turn, this would also favour the holder of asset-referenced tokens
by building confidence in the financial system.
Stakeholders Costs Benefits

Issuers of asset- Adaptation and compliance Better risk management
reference tokens costs Level playing field
Competent Supervisory costs Financial stability
authority Level playing field
Clients/ token None Financial stability
holders Confidence in the quality of the risk
standards of the issuer
Preferred option
29. Regarding the procedure and timeframe that issuers of asset-referenced tokens should follow
to increase their level of own funds a combination of option A and B is preferred, as it is easy
to implement, reduced the operational burden and ensures supervisory convergence across
the EU.
30. Regarding the definition of criteria for higher degree of risk option B is the preferred one, as it
allows competent authorities to follow a case-by-case approach with a broad assessment of all
the criteria without any additional burden for issuers of asset-referenced tokens. This option
would also ensure a minimum level of harmonisation and proportionality.
31. Regarding the minimum requirements for stress testing option A is preferred, as it would
ensure robust reserve asset management and operational requirements to instil confidence,
ensure the stability of the peg and avoid a run on the token with possible contagion to the
financial sector. Requiring liquidity and solvency stress tests as a minimum is indeed a balance
between the burden on issuers of asset-referenced tokens and the good identification of the
risks which they are exposed to.
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Question 1. Is the procedure clear and the timelines for the issuer to provide views on
the assessment and submit the plan reasonable?
feasible?
Question 4. Do you agree with the criteria to identify if an issuer has a higher degree of
risk?
Question 5. Do you agree with the procedure to assess whether an issuer has a higher
degree of risk?
Question 6. Do you consider the criteria and their evaluation benchmarks sufficiently
clear?
Question 7. Do you agree with the need for a solvency and liquidity stress-test and the
requirements of the stress-test?
Question 8. Do you agree with the frequency and time horizon of the solvency and
liquidity stress-test? Should there be more differentiation between
significant and not-significant issuers? Should the stress testing be more
frequent for issuers of asset-referenced tokens referenced to official
currencies?
Question 9. Should a reverse stress testing requirements/methodology be introduced?

Please provide your reasoning.
Question 10. Do you have any other comments in relation to the stress-testing part in
these RTS?
34

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MiCAR

Virtual public hearing: 17 January

Hybrid Public Hearing: 30 January

Virtual Public Hearing: 17 January

Hybrid Public Hearing: 30 January

Hybrid Public Hearing: 30 January

Draft Implementing Technical Standards

1. Responding to this consultation

Comments are most helpful if they:

AMLD Anti-money laundering directive (Directive (EU) 2015/849)

(a) “The number of holders;

4. Background and rationale

(a) the number of holders;

• the objectives of the reporting by issuers of ARTs in Article 22(1) of MiCAR;

• reporting by issuers of ARTs on holders in Article 22(1)(a) of MiCAR;

• reporting by issuers of ARTs on the reserve of assets in Article 22(1)(b) of MiCAR;

• reporting transactions by CASPs according to Article 22(3) of MiCAR;

• the reporting reference dates and related reporting remittance dates.

The objectives of the reporting by issuers of ARTs in Article 22(1) of MiCAR

Reporting by issuers of ARTs on holders in Article 22(1)(a) of MiCAR

Reporting by issuers of ARTs on the reserve of assets in Article 22(1)(b) of MiCAR

Reporting transactions by CASPs according to Article 22(3) of MiCAR

template S 07.02 - DISTRIBUTED LEDGER ADDRESSES FOR MAKING TRANSFERS ON BEHALF OF

The reporting reference dates and related reporting remittance dates

5. Draft implementing technical

COMMISSION DELEGATED REGULATION (EU) …/…

supplementing Regulation (EU) 2023/1114 of the European Parliament and of the

(Text with EEA relevance)

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

(3) Considering the definition of “transactions” in Article 22(1) second subparagraph of

(4) The definition of “transaction” in Article 22(1) second subparagraph of Regulation

HAS ADOPTED THIS REGULATION:

For the Commission

[For the Commission

Annex I – Reporting for issuers of asset-referenced token - templates

6.1 Draft cost-benefit analysis / impact assessment

- protect holders, in particular retail holders;

D. Policy issues, options considered

Policy issue 1: Level of detail on the number of holders

(a) Country of the holders;

(b) Number of retail and non-retail holders;

(c) Number of holders of custodial and non-custodial wallets16;

Policy issue 3: Reporting on the reserve of assets

(i) Of which within the country;

(ii) Of which received transaction to the country; and

(iii) Of which sent transaction from the country.

Policy issue 5: Reconciliation of data received from CASPs

E. Cost and benefit analysis

6.2 Overview of questions for consultation

Draft Regulatory Technical Standards

1. Responding to this consultation

Comments are most helpful if they:

AMLD Anti-money laundering directive (Directive (EU) 2015/849)

4. Background and rationale

(a) “the number of holders;

• the objectives of the reporting in Article 22(1), point (d) of MiCAR;

• the scope of transactions associated to uses of ARTs and of EMTs denominated in a

• the reporting of transactions between non-custodial wallets or between other type of

The objectives of the reporting in Article 22(1), point (d) of MiCAR

The reporting of transactions between non-custodial wallets or between other type of

5. Draft regulatory technical standards

COMMISSION DELEGATED REGULATION (EU) …/…