MiCA Compliance: What It Means for Olbra

The European Union's Markets in Crypto-Assets (MiCA) regulation represents the most comprehensive crypto regulatory framework in the world. For stablecoin issuers like Olbra, MiCA creates both obligations and opportunities. This article explains what MiCA is, what it requires, and how we're positioning Olbra for full compliance.

What Is MiCA?

MiCA (Markets in Crypto-Assets) is a regulatory framework adopted by the European Union in 2023 that provides comprehensive rules for crypto-asset issuers and service providers. It's the first major jurisdiction to create a unified regulatory approach to crypto, replacing the patchwork of national rules that previously existed.

For stablecoins specifically, MiCA creates two categories: Asset-Referenced Tokens (ARTs), which are backed by multiple assets, and E-Money Tokens (EMTs), which are backed by a single fiat currency. PLNY, EURY, and USDY are all classified as EMTs—digital representations of their respective fiat currencies.

Key Requirements for Stablecoin Issuers

MiCA imposes significant requirements on EMT issuers. Here are the key obligations we're building toward:

• Authorization: EMT issuers must be authorized as either a credit institution or an electronic money institution (EMI) in an EU member state.
• Reserve Requirements: At least 30% of reserves must be held as deposits in credit institutions, and reserves cannot be invested in risky assets.
• Redemption Rights: Token holders must have the right to redeem their tokens at par value at any time, with claims on reserves in case of issuer insolvency.
• White Paper: Issuers must publish a detailed white paper containing specific disclosures about the token, risks, and issuer.
• Capital Requirements: Minimum own funds requirements based on the size of the issued tokens.

Why Compliance Matters

Some in the crypto industry view regulation skeptically. We see it differently. Here's why MiCA compliance is core to our strategy:

• Market Access: MiCA-compliant tokens can operate freely across all 27 EU member states. Non-compliant issuers face severe restrictions or outright bans.
• Institutional Adoption: Banks, asset managers, and corporations can only work with regulated entities. Compliance unlocks enterprise use cases.
• User Protection: The requirements exist to protect users. Full reserve backing, redemption rights, and disclosure requirements benefit everyone.
• Long-term Sustainability: Operating in regulatory gray zones creates existential risk. Building for compliance ensures we can operate indefinitely.

Olbra's Compliance Roadmap

We're not waiting for enforcement deadlines to build compliant infrastructure. Here's our approach:

Licensing: We're pursuing EMI authorization in Poland, working with the Polish Financial Supervision Authority (KNF). Poland offers a strong regulatory environment and positions us well for the broader EU market.

Reserve Structure: Our reserve model already exceeds MiCA requirements. We maintain over 70% in bank deposits (vs. the 30% minimum) and limit investments to short-term government securities.

Redemption Infrastructure: Our minting and redemption system ensures any user can convert PLNY to PLN at par value, with clear processes and timelines.

Transparency: Our white paper, proof of reserves, and audit reports meet or exceed MiCA disclosure requirements.

What This Means for Users

For PLNY holders, MiCA compliance provides concrete benefits:

• Legal Certainty: Your tokens are issued by a regulated entity under clear legal frameworks. No ambiguity about their status.
• Guaranteed Redemption: The right to redeem at par value is enshrined in law, not just our terms of service.
• Reserve Protection: In the unlikely event of issuer problems, MiCA provides priority claims on reserve assets for token holders.
• Broader Utility: Compliant tokens can be used with regulated financial services—banks, payment processors, and institutional platforms.

Looking Ahead

MiCA's stablecoin provisions became applicable in June 2024, with full enforcement ramping up through 2025. We see this as a competitive advantage: while some issuers scramble to adapt, we've been building for compliance from the start.

The regulated stablecoin market in Europe is just beginning. By positioning Olbra as a compliance-first issuer, we're building for the long term—creating infrastructure that can serve European users for decades to come.

Questions about our regulatory approach? Read our documentation or visit our compliance page for more details.