E-Money Token

Definition

A type of crypto-asset that purports to maintain a stable value by referencing the value of one official currency. EMTs are regulated under both MiCAR (Title IV) and the E-Money Directive (EMD2), and may only be issued by credit institutions or authorised electronic money institutions.

What is an E-Money Token?

An E-Money Token (EMT) is a crypto-asset that purports to maintain a stable value by referencing the value of one single official currency. EMTs function similarly to electronic money but are issued on distributed ledger technology. Under MiCAR, only credit institutions and authorised electronic money institutions may issue EMTs.

Regulatory Framework

EMTs are governed by both MiCAR (Title IV, Articles 48–58) and the E-Money Directive (EMD2, Directive 2009/110/EC). Issuers must comply with the safeguarding requirements for funds received, grant holders a claim to redeem at par value at any time, and may not grant interest or any other benefit related to the length of time the holder holds the EMT.

Significant EMTs

Like ARTs, EMTs may be classified as 'significant' and subject to enhanced supervisory requirements under EBA oversight. The criteria include the size of the customer base, the value of the EMTs issued, and the number and value of transactions.