Circle, a digital currency enterprise, announced on Monday that it has obtained recognition as an electronic money entity, or EMI, in France. This accreditation is a pivotal license that enables the company to function as a compliant stablecoin provider in accordance with the stringent cryptocurrency laws of the European Union.
Originally launched in 2018 by the cryptocurrency company Circle, USDC has now become the second-largest stablecoin worldwide, with over $30 billion worth of tokens currently in circulation.
Circle revealed that it has been granted an e-money license by France’s banking regulatory body, Autorite de Controle Prudentiel et de Resolution, also known as ACPR. This achievement positions Circle as the initial global stablecoin issuer to meet the standards of the European Union’s pioneering legislation, Markets in Crypto-Assets (MiCA).
The implementation of this license signifies that both USDC and Euro Coin (EURC) tokens from Circle are now being issued in the EU in line with MiCA’s stablecoin regulatory requirements. To facilitate this, Circle Mint, the platform allowing businesses to create and redeem Circle stablecoins, is now open in France.
Jeremy Allaire, the co-founder and CEO of Circle, expressed his satisfaction by stating, “Since our inception, Circle has strived to construct robust, compliant, and well-regulated frameworks for stablecoins.” Allaire added that adhering to MiCA is a significant milestone in advancing digital currency into the mainstream for broader acceptance and utilization.
Stablecoins represent a category of cryptocurrencies linked to conventional assets, typically government-issued currencies like the U.S. dollar. Investors employ stablecoins to evade the volatility associated with other cryptocurrencies such as bitcoin.
They serve as a crucial method for swiftly exchanging cryptocurrencies, bypassing the necessity of relying on fiat currencies stored in bank accounts.
The adoption of stablecoin regulations in the EU marks a significant step forward. Last year, EU regulators enacted the world’s inaugural comprehensive legislation governing the operations of cryptocurrency companies. This legislation outlines protocols to ensure investor safeguards and safeguard platforms against potential manipulation.
Although MiCA officially came into effect in May 2023, the provisions concerning stablecoins were only approved last week. These measures were perceived as considerably stringent, mandating restrictions on the volume of trading permitted with specified stablecoins, notably those denominated in U.S. currency.
Following the regulations set out under MiCA, Circle, as a registered EMI in France, can now extend its services, including the ability for customers throughout the European Union to mint and redeem USDC through Circle Mint.
As of September 2018, the collaboration between Circle and cryptocurrency exchange Coinbase resulted in the establishment of USDC, currently the second-largest stablecoin globally, with a circulating value of $32.4 billion. Tether’s USDT remains the primary stablecoin in the world, with a circulation exceeding $112.7 billion.
The obligations stipulated by MiCA for crypto asset service providers must be fulfilled by December 30, 2024. Subsequently, companies operating in the cryptocurrency sector have until July 2026 to ensure full compliance with MiCA standards.
