Circle Advocates for MiCA Revisions to Enhance Stablecoin Framework in Europe

Circle, the issuer of USDC and EURC, has submitted its formal response to the European Commission’s review of the Markets in Crypto-Assets Regulation (MiCA), urging policymakers to refine the existing framework to better accommodate stablecoin operations in Europe.

In its submission, made on October 1, Circle emphasizes the need to preserve multi-issuance structures, which allow a stablecoin to be co-issued by both EU-authorized entities and foreign-regulated counterparts. Circle argues that restricting such structures could lead European users to seek offshore alternatives, undermining the protections MiCA aims to provide.

Additionally, Circle is advocating for a reconsideration of the current reserve requirements, which stipulate that e-money token issuers must hold at least 30% of reserves in commercial bank deposits, increasing to 60% for significant tokens. The company contends that these rigid requirements could elevate risks to the banking sector and suggests replacing them with a more flexible liquidity standard that assesses reserves based on their ability to meet redemption demands.

Circle's proposal also includes the establishment of a recognition regime for foreign-regulated stablecoins, allowing issuers to maintain primary supervision in their home jurisdictions while gaining access to European markets through local licenses. This approach aims to prevent compliance challenges from driving stablecoin activity outside the EU regulatory framework.

With around 30 e-money tokens authorized under MiCA, Circle notes that only three of the world's top 25 stablecoins are compliant with the regulation. The company believes that refining the MiCA framework is essential for Europe to attract global liquidity while maintaining consumer protections.

New Developments in Stablecoin Regulation

• As of September 23, 2026, the supply of euro stablecoins was approximately €794 million (~$900 million), while dollar stablecoins exceeded $311 billion.
• Over 99% of the stablecoin market is pegged to the US dollar.
• Circle's EURC has a supply of around €460 million, and Société Générale Forge's EURCV sits at approximately €190 million.
• New dollar-pegged tokens include AllUnity's USDAU and Paxos' USDG, both launched around late September 2026.
• As of early October 2026, 25 companies were authorized as MiCA e-money token issuers across the EU.
• The MiCA framework took effect in 2024, establishing a licensing system for stablecoin issuers and classifying fiat-backed stablecoins as e-money tokens (EMTs).
• Issuers must hold 1:1 reserves primarily in cash or cash equivalents at EU institutions under MiCA regulations.