A stablecoin issued in the EEA after 30 June 2024 must be classified as either an e-money token (EMT) under Title III of Regulation (EU) 2023/1114 (MiCA) or an asset-referenced token (ART) under Title IV. The classification determines which authorization the issuer needs, what the reserve must hold, and whether holders have a redemption right at par. The distinction turns on what the token references and how the issuer promises to maintain value.
The statutory definitions
Article 3(1)(6) MiCA defines an e-money token as a crypto-asset that purports to maintain a stable value by referencing the value of one official currency. Article 3(1)(5) defines an asset-referenced token as a crypto-asset that purports to maintain a stable value by referencing another value or right, or a combination of both — including a basket of official currencies.
The key word is referencing. A token references what its issuer uses to determine the redemption or stabilization mechanism. If the token's claim to stability depends solely on euro or another single fiat currency, it is an EMT. If it depends on anything else — a basket of fiat, a commodity, an algorithm, a pool of financial instruments, or a combination — it is an ART.
Single-currency stablecoins: EMT
A stablecoin that references only one official currency and promises redemption at par against that currency is an EMT. The issuer must:
- Hold authorization as a credit institution under Directive 2013/36/EU (CRD IV) or as an e-money institution under Directive 2009/110/EC (EMD2), or obtain specific authorization under Article 58 MiCA.
- Hold reserve assets equal to 100% of the token's par value, invested in deposits, short-term government debt, or money-market funds meeting the criteria in Article 36 MiCA.
- Grant holders a redemption right at par against the reference currency at any time and free of charge, subject to limited exceptions in Article 46 MiCA.
- Comply with safeguarding requirements in Article 37 MiCA, segregating reserve assets from the issuer's own holdings.
The classic example is a euro-denominated stablecoin where each token represents one euro and the issuer holds one euro in a segregated account for each token in circulation. A dollar-pegged token issued in the EEA follows the same regime, referencing USD as the single official currency.
Multi-currency and basket stablecoins: ART
A stablecoin that references more than one currency — even if both are official currencies — is an ART. Article 16(4) MiCA states that a crypto-asset referencing several official currencies as a means of stabilizing its value is an asset-referenced token, not an e-money token.
The issuer must:
- Obtain authorization under Article 21 MiCA (or be a credit institution complying with Title IV).
- Hold a reserve of assets that correspond to the basket or value referenced, meeting composition requirements in Article 36 MiCA.
- Publish a white paper approved by the competent authority under Article 18 MiCA, detailing the reserve composition, stabilization mechanism, and rights of holders.
- Maintain own funds equal to at least the higher of €350,000 or 2% of the average amount of reserve assets, under Article 35 MiCA.
A token that tracks a basket of 50% EUR and 50% USD is an ART, as is one that tracks the IMF's Special Drawing Rights (SDR) or a commodity-linked index. The fact that all components are official currencies does not make it an EMT — the multi-currency reference places it in Title IV.
Algorithmic stablecoins and crypto-collateralized tokens
A stablecoin that maintains value through an algorithm rather than a reserve of external assets still purports to maintain a stable value by referencing a value or right. If the algorithm targets a single fiat currency and the issuer commits to redemption at par, the token may meet the EMT definition — but only if the reserve backing satisfies Article 36 MiCA, which requires liquid, low-risk assets. Most algorithmic designs do not meet this threshold.
If the token is collateralized by other crypto-assets (e.g., over-collateralized with ether to maintain a dollar peg), it references both the target currency and the collateral pool's value. That makes it an ART, not an EMT, because the stabilization mechanism depends on more than the single reference currency.
Article 16(5) MiCA permits member states to prohibit the offer of ARTs that rely on a stabilization mechanism that does not maintain a reserve of assets. This provision addresses algorithmic or under-collateralized designs. Crypto-collateralized tokens that do maintain a reserve fall under Title IV, subject to the composition constraints in Article 36(4) — which limit crypto-asset holdings in the reserve to 30% for ARTs not pegged to a single official currency.
The redemption-right test
Another practical marker: EMTs grant a statutory redemption right at par under Article 46 MiCA. ARTs do not carry the same right unless the white paper commits to it. If the issuer's documentation says "redeemable at par at any time against euro", the token is likely an EMT — provided it references only euro. If the documentation says "the issuer will use commercially reasonable efforts to maintain value near $1" without a redemption commitment, the token is an ART (or, if it lacks sufficient reserve, may not qualify for either regime and would be unauthorized).
The redemption right is not dispositive on its own. A token that references a basket but offers redemption at par against one component currency is still an ART, because the reference determines classification, not the redemption mechanism.
Significance thresholds and additional requirements
Both EMTs and ARTs may become significant tokens if they meet any threshold in Article 43 MiCA:
- Customer base exceeds 10 million.
- Market capitalization or reserve value exceeds €5 billion.
- Average number and value of daily transactions exceeds 2.5 million transactions or €500 million over the preceding six months.
- The issuer is significant as determined by the European Banking Authority (for EMTs) or the European Securities and Markets Authority (for ARTs).
Significant EMTs and ARTs face stricter own-funds requirements, liquidity management obligations, and direct supervision by the EBA (for EMTs) or ESMA (for ARTs). Authorization as a significant token issuer requires submission of a recovery and redemption plan under Article 55 MiCA.
Classification as EMT versus ART determines which supervisor assesses significance. A mis-classified token that grows past the thresholds will be supervised by the wrong authority, creating regulatory uncertainty and potential enforcement risk.
Transition and existing stablecoins
Stablecoins issued before 30 June 2024 had 18 months to comply with MiCA or cease offering in the EEA. Issuers had until 30 December 2024 to determine classification and submit authorization applications. Verify the current authorization status of a stablecoin issuer in the ESMA register to confirm whether the competent authority classified the token as an EMT or ART.
Many issuers applied for EMT authorization in one member state and ART authorization in another, hedging against supervisory interpretation. The home member state competent authority makes the initial classification decision when reviewing the authorization application. Article 62(1) MiCA states that the application must specify whether the issuer seeks authorization as an issuer of e-money tokens or asset-referenced tokens — the issuer proposes, the authority decides.
Common mis-classifications and supervisor divergence
The most common classification error is treating a basket token as an EMT because all basket components are fiat currencies. Article 16(4) MiCA explicitly overrides this: multiple currencies mean ART.
A second common error is classifying a stablecoin backed by a portfolio of short-term government bonds as an EMT solely because the bond portfolio is denominated in the reference currency. If the token's value is determined by the market value of the portfolio rather than a fixed par redemption, the token references the portfolio's value, not the currency itself, and is an ART.
Supervisory practice diverged in 2024–2025 on commodity-linked stablecoins. Some authorities treated a gold-pegged token with a euro redemption option as an ART referencing both gold and euro. Others classified it as an ART referencing only gold, reasoning that the euro redemption was an exit mechanism rather than a reference value. ESMA issued Q&A guidance in March 2025 clarifying that a token granting the issuer discretion to redeem in fiat or commodity references both, making it an ART, but if the holder chooses the redemption asset, the reference depends on the default.
The Q&A did not resolve all edge cases. Until further guidance or case law emerges, issuers face a choice: describe the reference mechanism precisely in the white paper and accept the competent authority's classification, or redesign the token to fall unambiguously into one regime.
Decision table
| Token design | Reference | Classification | Key requirements |
|---|---|---|---|
| 1 EUR = 1 token, redeemable at par | Single official currency (EUR) | EMT | Authorization under Article 58 MiCA or EMD2; 100% reserve in low-risk assets; redemption right at par |
| Tracks $1, backed by USD deposits | Single official currency (USD) | EMT | Same as above; reserve in USD-denominated assets |
| Basket: 60% EUR, 40% USD | Multiple official currencies | ART | Authorization under Article 21 MiCA; reserve matching basket; white paper; own funds ≥€350k or 2% of reserves |
| Tracks gold price, redeemable in EUR or gold | Commodity + fiat currency | ART | Same as above; crypto-assets limited to 30% of reserve if present |
| Algorithmic peg to USD, no external reserve | Algorithm targeting single currency, no reserve | Likely unauthorized (may be prohibited under Article 16(5) if member state adopts prohibition) | Member state may ban; otherwise ART regime applies if reserve is created |
| Over-collateralized with ETH, targets $1 | Crypto-collateral + target currency | ART | Reserve composition subject to 30% crypto-asset limit under Article 36(4) |
Practical next step
If you are an issuer determining classification, draft the stabilization mechanism description as it will appear in the white paper, then map each input to the reserve. If the reserve backing 100 tokens comprises 100 units of a single fiat currency in a custodian account, you are describing an EMT. If it comprises 50 EUR and 50 USD, or a portfolio of government bonds whose market value determines redemption, you are describing an ART. Submit the application to the competent authority in your intended home member state specifying the regime; the authority's approval or rejection will confirm classification. Track the register for precedent: how other stablecoin issuers with similar designs were classified by the same authority.
For CASPs offering stablecoins issued by third parties, classification determines whether you need authorization to provide custody or exchange services for an EMT versus an ART. The services are equivalent under Article 3(1)(15) MiCA, but some member states imposed stricter capital or organizational requirements on firms handling significant ARTs during the 2024–2025 transitional period. Check your home member state's transposition measures and the ESMA register for authorized CASPs to see which services each firm is authorized to provide.