Circle's USDC Receives 'Significant' Status from EU Regulator Under MiCA Rules
French regulators alongside EU authorities will supervise the world's second-largest stablecoin following its designation as a "significant e-money token."
Under the European Union's Markets in Crypto Assets (MiCA) regulatory framework, the European Banking Authority (EBA) has designated Circle's USDC stablecoin with significant e-money token status.
According to a notice released on Wednesday, the e-money token designation, which has been awarded to a total of 45 other initiatives, signifies that joint supervision of the USDC stablecoin will be conducted by both the EBA and France's regulatory body, the Autorité de Contrôle Prudentiel et de Résolution. With a market capitalization of $73 billion, the stablecoin ranks second in size, trailing behind Tether USDt's $184 billion valuation.
The designation as "significant" emerged during a period when numerous token issuers based within the European Union have been advocating for regulated stablecoins pegged to the US dollar throughout the region. In a conversation with Cointelegraph, Stable Mint CEO James Bennett noted that although Europe couldn't simply "wish away" stablecoins denominated in dollars, regulatory authorities maintained the ability to establish safeguards and implement rules governing issuers.
"For European corporates to make cross-border payments globally, offering only a euro stablecoin isn't enough,"
AllUnity CEO Alexander Höptner told Cointelegraph
While regulatory authorities and token issuers progress toward accepting stablecoins denominated in US dollars, European Central Bank policymakers are continuing their examination of potentially launching a digital euro. The European Union authority initially put forward the central bank digital currency proposal in 2020, with the possibility of releasing the digital currency in 2029 following the completion of legislative processes and a pilot program.