European Union Authority Classifies Circle's USDC as "Significant" Under MiCA

The second-largest stablecoin by market value will be supervised by French and EU authorities under its classification as a "significant electronic money token."

The second largest stablecoin by market capitalization will be monitored by French and EU authorities under its classification as a "significant electronic money token".

The European Banking Authority (EBA) has classified the USDC Circle stablecoin as a significant electronic money token under the region's Markets in Crypto Assets (MiCA) framework.

In an announcement on Wednesday, the banking regulator said the cryptocurrency classification, granted to only 45 other projects, effectively means the USDC stablecoin will be jointly overseen by the EBA and the French regulatory authority, Autorité de Contrôle Prudentiel et de Résolution. The stablecoin is the second largest coin by market cap at $73 billion compared to Tether USDt's $184 billion.

The “significant” classification comes as many EU-based token issuers push for USD-pegged stablecoins in the region. StableMint CEO James Bennett told Cointelegraph that while Europe cannot “aspire” to dollar-denominated stablecoins, regulators can control issuers’ safeguards and rules.

AllUnity CEO Alexander Höptner told Cointelegraph: “It is not enough for European companies to be able to make cross-border payments globally, offering only one Euro stablecoin.

As authorities and issuers move closer to accepting dollar stablecoins, European Central Bank policymakers continue to explore the possibility of introducing a digital euro. The EU official proposed a central bank digital currency for the first time in 2020, with the potential to issue coins in 2029 after that. Conclusion of the law and a pilot program.