Circle has submitted a formal response to the European Commission regarding the review of the Markets in Crypto-Assets Regulation (MiCA). The company argues that current rules prevent major global stablecoins from entering the European market, noting that only three of the top 25 stablecoins by market value are currently MiCA-regulated.
The issuer of USDC and EURC recommends maintaining the 'multi-issuance' structure, which allows EU-authorized entities to co-issue tokens alongside foreign-regulated counterparts. Circle warns that restricting this model would drive crypto activity outside the European Union's jurisdiction.
Regarding reserve requirements, Circle opposes the current mandate that forces issuers to hold 30% to 60% of reserves in commercial bank deposits. The company claims this increases credit risk and suggests replacing it with flexible liquidity requirements, while also calling for the removal of caps on sovereign exposure and limits on holdings at individual banks.
The European Commission is expected to revise the MiCA framework in 2027 to address the status of foreign stablecoin issuers. This regulatory debate occurs as the EU continues to manage the transition period for crypto firms and monitors compliance across major trading platforms.
