Circle lobbies the European Commission to relax MiCA's reserve and concentration requirements, arguing they exclude major stablecoins from EU markets.
DeFi & Yields ·
Circle, the issuer of USDC and EURC, has called on the European Commission to modify key elements of MiCA, the EU's digital-assets rulebook. In a submission to the Commission's regulatory review, Circle argued that while MiCA has generated numerous regulated issuers, it has largely excluded the world's largest stablecoins from operating within Europe's framework. Of the top 25 stablecoins by market value, only three comply with MiCA, according to the company.
Circle's primary concern centers on reserve requirements. MiCA mandates that e-money token issuers maintain at least 30 percent of reserves in commercial bank deposits, increasing to 60 percent for tokens classified as "significant." Circle contends these rules heighten exposure to banking-sector risk and requested their replacement with a more flexible liquidity standard—a position aligned with the European Central Bank's stance. The company also sought removal of a 35 percent cap on single-sovereign exposure and per-bank holding limits, which it said would require large issuers to fragment reserves across numerous financial institutions.
Circle urged preservation of "multi-issuance" arrangements, which permit globally circulating stablecoins to be co-issued by an EU-authorized entity alongside foreign-regulated versions, warning that restrictions would redirect activity outside Europe. The submission comes ahead of a planned 2027 MiCA revision expected to address foreign stablecoin issuers more directly.