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A day after unveiling Pontes, its system for settling tokenised assets in central bank money, the ECB has set out how it wants Europe’s crypto rulebook rewritten.

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The response, published on Tuesday by the European System of Central Banks, which groups the ECB with the EU’s national central banks, argues for tougher rules on stablecoins, staking and crypto firms.

It feeds into the European Commission’s review of the Markets in Crypto-Assets Regulation, known as MiCA, the EU’s rulebook for cryptocurrencies and the firms that trade them.

MiCA has applied since December 2024, and the last transitional deadline for existing operators expired on 1 July, including Binance, the world’s largest exchange, to stop serving European customers.

The Commission’s consultation will close on 30 September, a month later than planned.

The central banks’ recommendations are not binding, and the Commission will weigh them alongside other responses before deciding whether to reopen the law.

EU diplomats have told Euronews they expect a revision in 2027, which would need the approval of the European Parliament and member states.

No interest and no loopholes

Stablecoins are cryptocurrencies designed to hold a steady value, usually by tracking the US dollar.

MiCA already bars both issuers and crypto exchanges from paying interest on them, and the central banks want it kept that way.

“The payment of stablecoin remuneration should continue to be prohibited,” the ECB response says.

Their targets are the workarounds. Some exchanges, the response notes, offer crypto lending, borrowing and staking, “thereby replicating the economic effect of interest payments through ancillary or unregulated services.”

The central banks want the ban extended to those activities and to indirect rewards, such as certain loyalty-programme benefits, calling it “a clear legislative priority”.

Washington has gone the other way.

The 2025 GENIUS Act banned US stablecoin issuers from paying interest but left exchanges free to offer rewards, and whether to close that gap became one of the most contested fights over the CLARITY Act, the landmark crypto bill that fell ten votes short in the US Senate on 15 September.

A brake on US dollar stablecoins

The central banks want stronger tools against tokens pegged to foreign currencies.

It would be useful, they say, if authorities could impose “a prohibition to issue new tokens, as well as an obligation to redeem existing tokens” on issuers where central banks judge that the tokens pose a threat, including to financial stability.

More broadly, they see limited benefit in stablecoins for everyday payments at home, given instant bank transfers and the planned digital euro. They warn that MiCA provides no legal basis for issuing the same stablecoin both inside and outside the EU.

In a bank run, European reserves could end up paying holders elsewhere, while “EU authorities cannot determine with certainty how many tokens are held within the Union.”

Eurozone central banks also do not currently let stablecoin issuers hold customer funds with them.

A token fully backed by central bank money, the response warns, “would effectively result in a ‘synthetic’ central bank digital currency” that is essentially a private imitation of the digital euro and could, in theory, drain deposits from commercial banks, especially under stress.

Staking and decentralised finance

On staking, where users lock up crypto in exchange for rewards, the response is blunt: “Staking, lending and borrowing of crypto-assets should be regulated at Union level.”

Where a firm takes customers’ crypto and promises to return it, potentially with a premium, the central banks argue that the arrangement can be “comparable to the taking of repayable funds”, in the language of banking.

The same applies to decentralised finance, or DeFi, where lending and trading run on automated software rather than through a company.

MiCA exempts fully decentralised services but never defines the term, and the central banks cite studies showing that full decentralisation is rarely, if ever, achieved, leaving it unclear who is in control.

Who licenses crypto exchanges?

The central banks also back a Commission proposal to move licensing and supervision of crypto firms from national regulators to ESMA, the EU’s markets watchdog.

Currently, one national licence covers the whole bloc, which was the route Binance originally pursued in Greece.

The Wall Street Journal reported last week, citing people familiar with the discussions, that ECB President Christine Lagarde urged Greek Prime Minister Kyriakos Mitsotakis not to approve Binance’s application because of the exchange’s past compliance problems and fears that its scale could deepen the use of US dollar stablecoins in Europe.

A senior Greek regulator, according to the newspaper, told the exchange that Lagarde wanted the decision delayed until ESMA took over, the same shift the central banks endorse in Tuesday’s response. Binance withdrew the application on 24 June.

Neither the ECB nor the Greek regulator has confirmed the account. The ECB, which has no formal role in licensing crypto firms, declined to comment, while Binance said it would “not comment on speculation”.

JEDDAH: Around 150 senior business leaders, investors and policymakers will gather in Riyadh on Sept. 29 to examine the forces expected to shape Saudi Arabia and wider MENAT economies over the next five years.

Forum to examine five-year economic outlook

The inaugural Economic Forum by Servcorp, powered by Emerging Markets Intelligence & Research, or EMIR, will examine the broader forces shaping the Kingdom and the wider Middle East, North Africa, and Turkiye, or MENAT, according to a press release.

As Saudi Arabia continues to advance its Vision 2030 agenda, the forum will use the Kingdom as its base while adopting a broader MENAT perspective.

Its five-year outlook will focus on the longer-term forces shaping business and policy decisions, drawing on Servcorp’s regional experience and EMIR’s economic intelligence to connect global developments with the practical realities of operating across MENAT.

Leaders to discuss regional growth and business priorities

“After more than 25 years supporting businesses in the region, we know that ambition creates value only when it is translated into execution,” CEO, Middle East, Europe, and America at Servcorp, David Godchaux, said.

Godchaux added that leaders must decide where to commit, which capabilities to build and which priorities to defer, yet the context for making those decisions is becoming more complex.

He added that the Economic Forum by Servcorp would provide a setting for candid, peer-level discussions on the decisions that will shape the region’s next phase of growth.

“The Economic Forum by Servcorp will provide a setting for candid, peer-level discussions on the decisions that will shape the region’s next phase of growth,” he said.

The war in Yemen is threatening to open a new front as the Iran-allied Houthi rebels are trying to advance along the Red Sea coast, through the mountain chains of Taiz province, edging closer to strategic ground that overlooks one of the world’s most vital maritime arteries.

For the internationally recognised Yemeni government, this is an offensive with global consequences.

In Wednesday’s interview with Al Jazeera, Yemen’s Ambassador to Qatar, Rajeh Badi, a former government spokesman, said that his government and its armed forces had not violated any truce since 2021.

The Houthis, he argued, are “the aggressors”. “What we are seeing now is a surprise Houthi offensive to seize strategic ground along the Red Sea, in order to allow Iran, through its Houthi proxy, to tighten its grip on maritime routes,” Badi said.

He added that the Houthis, who have advanced on al-Makha (Mocha) and al-Waziyah, and over large stretches of the mountain chain overlooking the Red Sea in Taiz province, “want commanding positions to launch more effective strikes on ships and disrupt navigation in the Red Sea”.

Badi said the Yemeni government responded by opening fronts in al-Jawf, Marib and al-Bayda, and that the consequences could extend far beyond Yemen.

“We are now facing a real threat that does not stop at Yemen’s borders,” he said. “It threatens the entire region and the world. If the Houthis manage to choke maritime traffic in the Red Sea, we will be looking at another Hormuz in these waters – with potentially even greater impact.”

The Red Sea and Bab al-Mandeb “represent a vital artery for global shipping, for both energy and food supplies”, he added.

A chokepoint that belongs to the world

Bab al-Mandeb connects the Red Sea to the Gulf of Aden. To the north, the Red Sea leads to the Suez Canal, while farther east, beyond the Arabian Sea, lies another critical chokepoint, the Strait of Hormuz. This geography is what gives Yemen’s conflict consequences far beyond its borders, as Saudi Arabia is already being drawn into the confrontation.

The Houthis have targeted Saudi territory, civilian infrastructure in the kingdom’s south and Saudi-linked vessels in the Red Sea.

Major-General Turki al-Maliki, spokesman of the Saudi-led coalition in Yemen, said the Houthis on Wednesday attacked Saudi cities of Khamis Mushait, Abha, and Jizan with ballistic missiles and drones. He did not elaborate on any casualties as a result of the attacks.

Badi, who has spoken to the media for the first time since taking up his post, said those attacks are designed to change the nature of the war.

“By targeting Saudi territory, civilian infrastructure in the kingdom’s south, and Saudi-linked vessels in the Red Sea, the Houthis are trying to drag Saudi Arabia into their war. Their calculation is simple: they want to rebrand this conflict as a Saudi-Yemeni war,” he said.

The ambassador assessed that “every time their militias suffer heavy losses inside Yemen at the hands of the Yemeni armed forces, they respond by firing missiles and drones at civilian sites in Saudi Arabia, in an attempt to inflame Yemeni public opinion and convince the outside world that Yemen is at war with Saudi Arabia”.

The conflict, he said, is fundamentally about Yemen’s state and its future. The Yemeni people are fighting to “reclaim their state, their republic, their dignity and their stability”.

Iran’s hidden hand

Behind Yemen’s fragmented front lines, a larger regional confrontation looms, and its architect, according to Badi, is Iran.

The official said that Tehran’s relationship with the Houthis is now impossible to hide. “Iranian officials openly boast about it, and Houthi leaders proudly talk about their ‘strategic’ ties with Tehran,” he said.

The Houthis are “one of Iran’s key regional arms – just like Hezbollah in Lebanon or the Popular Mobilisation Forces (PMF) in Iraq. Many of Tehran’s other proxies have come under pressure,” he added.

“Former Yemeni President Abd-Rabbu Mansour Hadi used to say that if Iran gains control over Bab al-Mandeb and the Strait of Hormuz, it will not need a nuclear weapon – its grip over these two chokepoints would be more powerful than any nuclear arsenal. Events have proved him right,” Badi recalled.

‘We have exhausted all peaceful avenues’

For Yemen’s government, the alternative to another war was supposed to be diplomacy.

Badi urged the world “to stand with us so we can rid ourselves of this scourge – a threat that no longer targets Yemenis alone”.

“We have exhausted all peaceful avenues. For more than 13 years, we have been engaging in dialogue rounds and signing agreements, whether inside Yemen or after the Houthis seized the capital, Sanaa,” he said.

Badi added that the Houthi rebels have effectively “buried peaceful options. Peace is simply not part of this movement’s culture or mindset. That is what ultimately forced us to take up arms”.

“The world must understand this difficult equation,” the ambassador concluded, that the Houthis are “an armed proxy, an extension of the Iranian Revolutionary Guard Corps. The Houthis do not represent us”.