EU faces September 30 clock to decide future of DeFi loans
Summary
The European Banking Authority has urged the European Commission to assess whether MiCA should impose duties on crypto firms that intermediate borrowing or provide customers access to DeFi lending. Possible measures include suitability checks, leverage limits, stronger risk disclosures, protocol security certification, and restrictions involving certain tokens without authorized issuers. The EBA cites risks including unclear fees and collateral terms, amplified losses, hacks, outages, poor records and over-indebtedness. Its response does not change current rules; the Commission will consider consultation feedback and may propose legislation. Any future rules would need to define which services and access routes are covered.
