Some believe that regulations and "transparency" are beneficial.
The reality is quite the opposite.
Requiring stablecoin reserves to be maintained within an EU-based financial institution is far from transparent. Worse still, it effectively hands control of these coins to traditional financial institutions. Given that much of crypto trading relies on stablecoins, this move essentially returns control of the entire ecosystem to these entities—the very antithesis of what cryptocurrencies were designed to achieve.
For governments, this is a godsend. All the fiat currency that crypto buyers have invested now falls under their control. They can use it to bolster their treasuries or allocate it as they see fit. They will control the reserves, reap the interest, and dictate terms. In doing so, they could even manipulate or crash the crypto markets if it serves their interests.