Stablecoin issuer Circle has called on the European Union to revise parts of its Markets in Crypto-Assets Regulation (MiCA), arguing that the current framework has failed to capture the largest global tokens.
In its response to the European Commission's consultation on the MiCA review, Circle stated that out of the top 25 stablecoins by market value, only three are currently MiCA-regulated. The company issued the recommendations ahead of a broader MiCA overhaul expected in 2027, as European crypto firms navigate the transition period and a wider global contest over stablecoin dominance unfolds.
To address the gap between regulated issuers and global market share, Circle urged the EU to preserve "multi-issuance." This structure allows a globally circulating stablecoin to be co-issued by an EU-authorized entity alongside a foreign-regulated counterpart, a setup the company claims prevents activity from being pushed offshore.
Circle's primary objections center on reserve requirements. MiCA currently mandates that e-money token issuers hold at least 30% of their reserves in commercial bank deposits, with that requirement increasing to 60% for tokens classified as "significant."
Siding with the European Central Bank, Circle argued that this bank-deposit mandate increases exposure to banking-sector credit risk and should be replaced with flexible liquidity requirements. Additionally, the firm asked regulators to eliminate a 35% cap on single-sovereign exposure and restrictions limiting how much capital can be held at any single bank, which it says forces large issuers to spread reserves across numerous institutions.
