Circle has submitted formal recommendations to the European Commission calling for a significant revision of the Markets in Crypto-Assets (MiCA) regulation's stablecoin reserve requirements, specifically targeting the mandatory bank-deposit floor that issuers must maintain Cointelegraph. The company, which issues the second-largest dollar-pegged stablecoin USDC, argues that current rules are contributing to the exclusion of major global stablecoins from European markets.
In its filing, Circle contends that MiCA's existing reserve mandates and concentration caps have effectively kept the largest global stablecoins outside Europe's regulatory perimeter Decrypt. The company is advocating for more flexible liquidity rules that would replace rigid bank-deposit minimums while preserving mechanisms for cross-border stablecoin issuance. This position notably aligns the private issuer with certain European Central Bank perspectives on regulatory flexibility.
The lobbying effort extends beyond reserve mechanics to encompass broader market structure concerns. European stablecoin issuers have concurrently made the case that euro-denominated stablecoins alone cannot satisfy market demand, emphasizing that businesses require USD liquidity for global payments and settlement operations Cointelegraph. This argument challenges assumptions that European regulatory frameworks can operate effectively while marginalizing dollar-backed instruments.
Circle's intervention forms part of a wider industry mobilization during the European Commission's scheduled MiCA review period. The Hyperliquid Policy Center has simultaneously submitted recommendations urging regulators to bring perpetual futures under MiFID II jurisdiction while Circle focuses on reserve requirements The Block. These parallel submissions indicate coordinated industry efforts to shape the regulatory framework's evolution.
Public pressure has also entered the discourse through a campaign that delivered approximately 50,000 letters to Brussels officials requesting eased restrictions on stablecoin rewards programs Cointelegraph. The campaign coincides with indications that EU central banks are themselves advocating for broader modifications to MiCA's stablecoin provisions, suggesting potential alignment between certain institutional and retail stakeholder interests.
The convergence of issuer lobbying, trader advocacy, and institutional input creates a complex political economy around the MiCA review, with Circle's position on reserve flexibility representing a potentially pivotal intervention given its operational scale and regulatory engagement history across multiple jurisdictions.