While Bitcoin and Ethereum remain undecided about their next direction, European Central Bank President Christine Lagarde stated that the European Union should impose guarantee requirements on stablecoin issuers based outside the EU.

Christine Lagarde emphasized the growing importance of stablecoins in the modern financial system and called for harmonized regulatory approaches. Her proposed solution is aimed at protecting investors and maintaining overall financial market stability. The key regulatory measure concerns mandatory asset reserves. If stablecoin issuers—regardless of jurisdiction—are required to maintain reserves equivalent to the volume of tokens issued, the risk of sudden value collapse due to mass redemptions would be significantly reduced.

Speaking at the annual conference of the European Systemic Risk Board, Lagarde pointed out that gaps still remain in the EU's Markets in Crypto-Assets (MiCA) regulation regarding requirements for stablecoin issuers. She also noted that MiCA obliges stablecoin issuers to hold substantial reserves in bank deposits and guarantees EU investors the right to redeem their assets at par value at any time.

The ECB President also warned that vulnerabilities persist, particularly in issuance schemes involving joint issuance of interchangeable stablecoins by entities from both within and outside the EU. In such cases, MiCA's strict rules apply only to the EU component, which, according to Lagarde, creates opportunities for regulatory arbitrage.

"In the event of a large-scale withdrawal of funds, investors will naturally prefer to redeem their assets in the jurisdiction offering the strongest guarantees—likely the EU—where MiCA also prohibits redemption fees," said Lagarde. "However, reserves held within the EU might not be sufficient to meet such concentrated demand." Lagarde called for European legislation to prohibit such schemes from operating within the EU.

As a reminder, the MiCA law, which came into force at the end of last year, establishes comprehensive rules and provisions regarding crypto assets across the entire European Union. MiCA primarily regulates the activities of crypto asset issuers and service providers.

Trading recommendations

Bitcoin technical outlook

Buyers are now aiming to reclaim the $111,600 level, which opens a direct path to $113,200, and from there, the next stop is $115,600. The ultimate target remains the high around $117,600—a breakout above which would confirm a strengthening bull market. In case of a decline, buyers are expected at $109,700. A drop below this level could quickly drag BTC down to $108,200, with the most distant target around $106,700.

Ethereum technical outlook

A clear consolidation above the $4,421 level opens the way to $4,499. The ultimate target remains the high near $4,601, a breakout of which would signal renewed bullish momentum and rising investor interest. If Ethereum declines, buyers are expected around $4,328. A drop below this level could push ETH down to $4,223, with the furthest support level near $4,132.

What's on the chart

• The red lines represent support and resistance levels, where price is expected to either pause or react sharply.
• The green line shows the 50-day moving average.
• The blue line is the 100-day moving average.
• The lime line is the 200-day moving average.

Price testing or crossing any of these moving averages often either halts movement or injects fresh momentum into the market.