🇪🇺 NEW: The company that benefits most from Europe's strict crypto rules is now the one asking Brussels to loosen them.
Circle, the $74 billion USDC issuer, submitted formal objections to the European Commission as part of its official review of MiCA, Europe's crypto regulation framework. The company's own analysis: just 3 of the world's 30 largest stablecoins currently meet MiCA's standards, leaving most of the global market locked out of Europe entirely.
Here's the irony nobody's saying out loud: that same strictness already handed Circle a near-monopoly. MiCA's reserve rules are what pushed USDT off EU platforms in the first place, making USDC the only fully compliant dollar stablecoin for European users. Circle benefited from the wall, and now wants to lower part of it anyway.
The core fight is over reserves. MiCA currently forces issuers to hold 30% to 60% of backing assets in commercial bank deposits. Circle wants that swapped for a liquidity-based rule instead, reserves that can be converted to cash within one to five business days, pointing directly to the 2023 Silicon Valley Bank collapse, which froze $3.3 billion of USDC's own reserves, as proof bank deposits create more risk than they solve.
Circle isn't alone here. The European Central Bank and national central banks reportedly favor the same liquidity-based approach. Circle also wants two technical limits scrapped: a cap on how much reserve exposure can sit with any single government, and restrictions that would force large issuers to spread deposits across dozens of banks.
The European Commission must deliver its formal review, and possibly a legislative overhaul, by June 30, 2027, under MiCA's own Article 140.
The company that MiCA built into Europe's only major stablecoin player is now trying to rewrite the exact rules that got it there.
#Circle #USDC #MiCA #Stablecoin #Regulation
Circle, the $74 billion USDC issuer, submitted formal objections to the European Commission as part of its official review of MiCA, Europe's crypto regulation framework. The company's own analysis: just 3 of the world's 30 largest stablecoins currently meet MiCA's standards, leaving most of the global market locked out of Europe entirely.
Here's the irony nobody's saying out loud: that same strictness already handed Circle a near-monopoly. MiCA's reserve rules are what pushed USDT off EU platforms in the first place, making USDC the only fully compliant dollar stablecoin for European users. Circle benefited from the wall, and now wants to lower part of it anyway.
The core fight is over reserves. MiCA currently forces issuers to hold 30% to 60% of backing assets in commercial bank deposits. Circle wants that swapped for a liquidity-based rule instead, reserves that can be converted to cash within one to five business days, pointing directly to the 2023 Silicon Valley Bank collapse, which froze $3.3 billion of USDC's own reserves, as proof bank deposits create more risk than they solve.
Circle isn't alone here. The European Central Bank and national central banks reportedly favor the same liquidity-based approach. Circle also wants two technical limits scrapped: a cap on how much reserve exposure can sit with any single government, and restrictions that would force large issuers to spread deposits across dozens of banks.
The European Commission must deliver its formal review, and possibly a legislative overhaul, by June 30, 2027, under MiCA's own Article 140.
The company that MiCA built into Europe's only major stablecoin player is now trying to rewrite the exact rules that got it there.
#Circle #USDC #MiCA #Stablecoin #Regulation
