Circle Secures Regulatory Approval as First Stablecoin Issuer Under MiCA
By: Isha Das
Circle has officially become the world's first stablecoin issuer to achieve regulatory approval under the European Union's newly enacted Markets in Crypto-Assets (MiCA) regulations. This milestone comes after Circle announced on July 1 that it received an e-money license from the Autorité de Contrôle Prudentiel et de Résolution (ACPR), France's financial watchdog.
The e-money license enables Circle to issue its stablecoins, USDC and Euro Coin (EURC), throughout the EU, marking a significant step toward mainstream integration of digital currencies. Circle CEO Jeremy Allaire stated, “Achieving MiCA compliance is a monumental step for Circle as we continue to build robust and regulated infrastructure for digital currencies. This milestone brings us closer to integrating digital currency into mainstream financial systems.”
Stablecoins play a pivotal role in the cryptocurrency market as they are pegged to traditional fiat currencies, such as the US dollar, offering a less volatile option compared to other cryptocurrencies like Bitcoin. This allows for rapid transitions within the crypto ecosystem without needing to convert back to fiat currencies.
The MiCA legislation is the first comprehensive legal framework in the EU designed to regulate crypto operations. It includes stringent measures aimed at investor protection and market stability. Full compliance with MiCA will be required by July 2026, although specific provisions for crypto asset service providers will take effect by the end of December 2024.
As part of the new regulations, the transaction volume of non-euro stablecoins is capped at 1 million transactions or 200 million euros ($215.2 million) daily. Circle's new regulatory status in France also grants it the advantage of MiCA's “passporting” feature, which allows crypto firms approved in one EU member state to operate freely across others.
Circle, founded in 2018, has already made a name for itself with its USDC stablecoin, which is the second-largest in the world. According to recent data, there are currently $32.4 billion worth of USDC tokens in circulation, second only to Tether's USDT with $112.7 billion in circulation.
