In an interview with Cointelegraph, Paolo Ardoino, chief executive of Tether, said European Union crypto-asset market (MiCA) regulation posed a systemic risk not only to stablecoins but also to the broader banking system. "My complaint with MiCA is that instead of making the system safer, it actually created a significant systemic risk," Ardoino said. The MiCA regulation, which came into effect on June 30, imposes strict restrictions on stablecoin operations across the European Economic Area. Notably, the regulation stipulates that at least 60% of the reserves backing stablecoins must be held in European Union bank accounts. Ardoino stressed that the Financial Institution Group operates a fractional reserve banking system, where only a small percentage of deposits are available for withdrawal at any given moment, making them vulnerable to bank runs.