Coinbase (@coinbase) has warned that tighter European Union rules on decentralised finance could leave regulated users worse off. Roeland Van der Stappen, the exchange's head of EU policy, said the changes under the Markets in Crypto-Assets Regulation (MiCA) could push people toward platforms with fewer investor protections.

What Coinbase Is Warning About

Van der Stappen identified lending, liquidity provision and on-chain swaps as the DeFi activities most exposed to new requirements, according to TokenPost. Regulated platforms could respond by narrowing their DeFi offerings or withdrawing access altogether, the report said.

He also argued that restricting access through regulated platforms could divide DeFi liquidity into smaller pools. That could give EU users worse trading prices and steer them toward providers outside the bloc with fewer safeguards, he said. He warned of the risk of "walled gardens," meaning isolated DeFi services.

Know when your
coins move

A central concern is how suitability tests would apply. Van der Stappen said extending such tests to other DeFi services could treat simple stablecoin swaps in the same way as leveraged lending, despite their different risk profiles, according to TechFlow. TokenPost noted that applying checks beyond lending and borrowing is a hypothetical outcome in his warning rather than the scope of the EBA consultation.

He called for a proportionate approach that would let crypto-asset service providers keep offering access with safeguards matched to each activity.

The Regulatory Backdrop

The comments follow the European Commission's review of MiCA. The European Securities and Markets Authority (ESMA) said on 30 September 2026 that it recommends a new regulated crypto asset service for firms that give users access to DeFi protocols. ESMA also called for clearer criteria on which activities can be considered genuinely decentralised.

ESMA has also warned of "decentralisation washing", where an identifiable operator uses DeFi-style language to avoid MiCA obligations, according to Securities.io. The regulator said the DeFi exemption should be as narrow as possible.

ESMA's response is not binding. Any change to MiCA would need a Commission proposal and adoption by the European Parliament and the Council, according to a summary of the response. TokenPost reported that the Commission is due to report to EU lawmakers by 30 June 2027, and that its report could include proposals to amend the regulation.

The debate reflects a wider tension in EU crypto policy between investor protection and keeping regulated access to DeFi workable. Whether the Commission adopts ESMA's proposed DeFi access category, and how it is designed, will determine how far the concerns raised by Coinbase come into play.

Sources

TokenPost: Coinbase Executive Warns Extending EU Suitability Checks Could Limit DeFi Access
ESMA: Calls for Changes to Make MiCA Clearer, Safer and Ready for Emerging Services
Securities.io: ESMA Proposes Targeted MiCA Changes for DeFi, Stablecoins and Staking