Electronic Money Tokens (EMTs) are a category of crypto-assets regulated under the EU's Markets in Crypto-Assets (MiCA) framework. An EMT is a token that purports to maintain a stable value by referencing exactly one official fiat currency — such as the euro or US dollar — and is backed by a reserve of assets denominated in that same currency. In practice, EMTs are the MiCA category that covers major fiat-backed stablecoins like USDC, USDT, and EURC.

What Qualifies as an EMT?

MiCA's definition requires two conditions to be simultaneously true for an EMT:

1. The token claims to maintain stable value by referencing a single official currency
2. The issuer holds a reserve of assets denominated in that same currency

The single-currency requirement is what distinguishes EMTs from Asset-Referenced Tokens (ARTs). A token pegged to a basket containing EUR + USD + gold would be an ART, not an EMT, because it references multiple assets. Pure single-fiat stablecoins fall squarely into the EMT definition.

MiCA Requirements for EMT Issuers

EMT issuers must be authorized either as a credit institution or as an Electronic Money Institution (EMI) under existing EU financial regulation — they cannot obtain a standalone MiCA license for EMT issuance alone. This creates a significant compliance pathway distinction from other crypto-asset types.

Reserve Requirements EMT reserves must maintain 1:1 backing with the referenced currency at all times. Reserve assets must be:

• Deposits at credit institutions (at least 30% of reserve)
• Secure, low-risk, highly liquid financial instruments
• Segregated from the issuer's own funds
• Valued and reported on at least a monthly basis

Redemption Rights Token holders have a statutory right under MiCA to redeem their EMTs at par value (1:1 with the referenced currency) at any time. Issuers cannot charge fees for redemption requests below certain thresholds, protecting retail holders against illiquidity during stress events.

Volume-Based Obligations MiCA introduces additional requirements for EMTs that exceed significance thresholds — specifically, tokens with more than 10 million holders or €5 billion in daily transaction volume face enhanced oversight from the European Banking Authority (EBA) rather than national regulators.

EMTs in DeFi

Most DeFi protocols that integrate stablecoins work with assets that would qualify as EMTs under MiCA. While DeFi protocols themselves may not be EMT issuers, they interact heavily with EMT issuers and should understand:

• Exchange listing requirements: MiCA-regulated exchanges must only list EMTs from authorized issuers, affecting which stablecoins remain accessible to EU users
• Smart contract integration: Whitelisting or integrating non-authorized EMTs may create regulatory exposure for protocols with EU presence
• Liquidity pool composition: Pools heavily weighted toward non-compliant stablecoins may face access restrictions from EU-regulated participants

Related Terms

• Asset-Referenced Tokens
• Markets in Crypto-Assets (MiCA)
• Qualified Custodian
• Operational Resilience