The European Central Bank (ECB) has released a new framework geared towards overseeing all forms of electronic payments in the region, including those bordering on stablecoins.
Embracing a diverse set of payment models, the ECB wants to ensure that only payment service providers with secure and efficient processes are operating within the bloc.
The new framework will now be the basis for overseeing startups or other players in the payment processing space. The ECB said companies that fall under its regulatory supervision will be required to implement all necessary provisions laid out within one year.
“The retail payments ecosystem is evolving fast owing to innovation and technological change. This calls for a forward-looking approach in overseeing digital payment solutions,” said ECB Executive Board member Fabio Panetta. “The PISA framework will include digital payment tokens such as stablecoins, alongside traditional payment instruments and schemes we have gained experience in over the years. Internationally coordinated action will also have to be stepped up to cope with the challenges posed by global digital payment solutions and stablecoins.”
According to the ECB, the newly published framework is in line with the forthcoming EU regulations on crypto-assets (including stablecoins) and international standards for global stablecoins. The ECB said it will be cooperating with the other global watchdogs in implementing the provisions of the new framework.
Regulators around the world have been exploring various avenues to tame the digital currency ecosystem, and the addition of stablecoins by the ECB further complements this position. Many have touted the potentials of digital currencies to power the next generation of online and digital payments, and industry proponents have been calling for a pan-government regulation of these emerging asset classes.
The new ECB framework is billed to serve as a basis for future interactions between the bank and the industry participants concerned.
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