On July 1, Jeremy Allaire, co-founder and CEO of Circle, announced that Circle has become the first stablecoin issuer in the European Union to receive regulatory approval under the EU’s Markets in Crypto-Assets (MiCA) framework. This groundbreaking approval ensures that Circle’s USDC and EURC stablecoins are now fully compliant with the new EU regulations, addressing concerns that investors might need to redeem or transfer their assets to maintain compliance.
Circle has selected France as its European headquarters, citing the country’s forward-thinking approach to digital asset regulation and its productive relationship with the French Prudential Supervision and Resolution Authority (ACPR). Allaire highlighted the significance of this regulatory milestone, reflecting on the rapid evolution of digital assets.
“The entire concept of fiat digital currency did not really even exist outside of very early crypto circles. The concept of seeing major global laws that enshrined stablecoins into the financial system was inconceivable,” Allaire stated.
The MiCA framework marks the first comprehensive regulatory approach for digital assets within the EU, signifying a pivotal moment for the industry.
In response to MiCA’s impending implementation, several exchanges have adjusted their stablecoin policies. In June, Uphold announced the delisting of six stablecoins for its European users, including Tether, Dai, TrueUSD (TUSD), Gemini dollar (GUSD), Pax dollar (USDP), and Frax Protocol (FRAX). Bitstamp also delisted Tether’s EURT stablecoin in preparation for the new regulations.
Binance, the world’s largest centralized exchange, opted for a different strategy by implementing a “sell-only” policy for certain stablecoin products in Europe. Instead of delisting, Binance classified stablecoins as compliant or non-compliant and restricted certain features for European customers to comply with the regulations.
Circle’s achievement and the adjustments by major exchanges underscore the significant impact of the MiCA framework on the crypto market, setting a new benchmark for regulatory compliance and stability in the industry.
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