Circle will be the first licensed stablecoin issuer under MiCA.
On July 1, Jeremy Allaire, co-founder and CEO of the Circle, announced that Firm Crypto-assets (MiCA) became the first stablecoin issuer in the European Union to receive regulatory approval under the European Union's sweeping markets.
Circle's USDC (USDC) and EURC are regulated under the new rules, which take effect immediately, eliminating investors' fear of having to redeem their stablecoins or transfer their funds to other digital assets in order to remain compliant.
Allair then announced that Circle has chosen France as the company's European headquarters, citing France's forward-looking stance on digital asset regulation and Circle's working relationship with the French Prudential Regulation and Resolution Authority (ACPR).
The Circle co-founder reflected on the historic significance of the EU's regulatory reform, the first comprehensive regulatory framework for digital assets—a testament to the long way the asset class has come since its inception.
“The whole concept of a fiat digital currency didn't even exist outside of very early crypto circles. The concept of seeing major global rules embedding a stable coin into the financial system was unthinkable.
Related: MiCA rules take effect in Europe – here's what you need to know
MiCA fears and a stable coin market
In preparation for the EU regulatory shift, several exchanges have announced changes to their stablecoin policies and product offerings.
In June, crypto exchange and escrow platform Uphold announced in an email to its European users that it was canceling six stablecoins. These include Tether (USDT), Dai (DAI), TrueUSD (TUSD), Gemini Dollar (GUSD), Pax Dollar (USDP), and Frax Protocol (FRAX).
Bitstamp followed suit in the same month, delisting Tether's EURT stablecoin in anticipation of the changes, despite being one of the first exchanges to list the digital fiat token.
Binance also took a similar but softer approach to the new stablecoin regulations, adopting a “sell” strategy for certain stablecoin products in the European market. The world's largest centralized currency exchange has revealed that it will not phase out any stablecoins for its European users at this time, instead marking fiat counterparts as compliant or non-compliant and restricting certain market features to European customers.
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