In a landmark move for the cryptocurrency sector, Circle, the company behind the widely used USD Coin (USDC), has secured a crucial e-money license from French authorities. This achievement places Circle as a compliant issuer of stablecoin under the European Union’s stringent crypto regulations.
The French banking industry watchdog, Autorite de Controle Prudentiel et de Resolution (ACPR), has officially granted Circle registration as an electronic money institution (EMI). This makes Circle the first global stablecoin issuer that aligns with the rigorous requirements of the EU’s Markets in Crypto-Assets (MiCA) regulatory framework.
Following this, Circle’s stablecoins, notably USD Coin (USDC) and Euro Coin (EURC), are now issued in full compliance with the obligations set forth under the MiCA stablecoin regulations. This compliance underscores the EU’s commitment to fostering a regulated environment for digital assets, emphasizing investor protection and platform integrity.
Circle’s co-founder and CEO, Jeremy Allaire, has emphasized the significance of this compliance for the future of stablecoins. Allaire’s remarks highlight Circle’s commitment to building infrastructures that comply with regulatory norms—an essential step towards the mainstream adoption of digital currencies.
Stablecoins, like USDC and EURC, are cryptocurrencies pegged to conventional assets such as fiat currencies, in this case, the U.S. dollar and the euro. They are designed to offer a more stable digital asset option, minimizing the volatility often associated with cryptocurrencies like bitcoin.
The European Union’s comprehensive MiCA law, which governs cryptocurrency operations within its jurisdiction, enforces strict measures to protect investors and prevent manipulative practices in crypto platforms. With specific provisions for stablecoins only recently approved, Circle’s compliance signals a move towards a more stable and regulated digital asset marketplace.
Circle’s own USDC, launched in partnership with crypto exchange Coinbase in 2018, is now the second-largest stablecoin in terms of circulation, standing at $32.4 billion. This is second only to Tether’s USDT, which boasts a staggering $112.7 billion in circulation.
The authorization from the ACPR not only positions Circle as a frontrunner in complying with emerging global regulations but also represents a significant milestone for the stablecoin industry. With this regulatory seal of approval, Circle sets a precedent for other digital currency firms aiming to operate within the boundaries of the European Union’s digital financial landscape.
