Circle has submitted proposals to the European Commission calling for revisions to the Markets in Crypto-Assets Act rules on foreign stablecoins and for the creation of a recognition mechanism for overseas issuers. According to Odaily, the company said foreign stablecoin issuers should mainly be supervised by regulators in their home jurisdictions, with local EU-licensed entities handling distribution after receiving equivalence recognition from relevant parties and the European Banking Authority.

Circle also said the mechanism should allow euro stablecoins to circulate in overseas jurisdictions. It further asked to remove a rule requiring e-money token issuers to keep 30% of reserve assets in commercial banks, while the requirement for “significant” e-money tokens is 60%. The company said the rule increases exposure to bank credit risk and counterparty risk.