Circle Responding to the EU MiCA review consultation, recommends retaining the multiple-issuer structure
BIBIBI
AT A GLANCE
Circle recommends that the EU retain a multi-issuer structure for stablecoins and establish a system for recognizing overseas regulation.
Article
【Circle: Recommends that the EU MiCA Retain a multi-issuer structure】
Circle disclosed that it has submitted a response to the European Commission’s targeted consultation on MiCA. Circle said that MiCA has given Europe a first-mover advantage, with approximately 30 e-money tokens currently authorized, but among the top 25 stablecoins by global market capitalization, only 3 are subject to MiCA regulation, namely USDC、USDG and EURC. The gap is that the MiCA regulatory scope does not cover the largest global tokens.
Circle recommends retaining a multi-issuer structure, under which globally circulating stablecoins would be jointly issued by MiCA authorized EU entities and foreign regulated entities. It also recommends establishing equivalence and recognition arrangements similar to EMIR、CSDR and MiFIR for foreign-regulated stablecoins, with the regulators in the jurisdictions where the issuers are based primarily responsible for supervision, and EU-level equivalence determinations and recognition of EBA entities. Regarding reserve requirements, Circle believes that MiCA requiring issuers to deposit at least 30%of reserve assets with commercial banks would increase bank credit and counterparty risks. It supports the European Central Bank reconsidering this requirement and recommends removing the two concentration rules in the EBA technical standards.
Key points
01
Circle said it submitted a response to the European Commission’s targeted consultation on MiCA.
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Circle said MiCA has currently authorized approximately 30 e-money tokens.
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Circle said that among the top 25 stablecoins by global market capitalization, only USDC、USDG and EURC are subject to MiCA regulation.
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Circle recommends that globally circulating stablecoins be jointly issued by MiCA authorized EU entities and foreign regulated entities.
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Circle recommends establishing equivalence and recognition arrangements for foreign-regulated stablecoins similar to EMIR、CSDR and MiFIR.
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Circle believes that depositing at least 30%of reserve assets with commercial banks would increase bank credit and counterparty risks.
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Circle supports the European Central Bank reconsidering the 30%reserve requirement and recommends removing the two concentration rules in the EBA technical standards.
AI-assisted interpretation
The following is analysis, separate from reported facts. Verify important claims independently.
Circle’s core proposal is for EU entities and overseas regulated entities to jointly issue stablecoins, with overseas regulation connected through equivalence determinations and entity recognition. It also believes that the proportion of reserves held as commercial bank deposits could create additional risks.
Why it matters to readers
This concerns the institutional arrangements for global stablecoins to enter or maintain compliant circulation in Europe, as well as how reserve assets are allocated. The current content consists of policy recommendations submitted by Circle and does not mean that EU rules have changed.
MiCA is the EU’s crypto-asset regulatory framework. The stablecoin issuance structure determines which entities issue the tokens; equivalence and recognition are mechanisms for regulatory jurisdictions to acknowledge each other’s supervisory arrangements.
Risks and unknowns
The evidence does not show that the European Commission, the European Central Bank, or EBA has adopted these recommendations.
The evidence does not specify any follow-up documents or a timeline for final rules resulting from the targeted consultation.
The evidence source is a Telegram page and lacks independent source verification.
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MiCA
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