On July 1, Jeremy Allaire, co-founder and CEO of Circle, proudly announced that Circle has become the first stablecoin issuer to receive regulatory approval under the European Union’s comprehensive Markets in Crypto-Assets (MiCA) framework.
This landmark achievement allows Circle’s USD Coin (USDC) and Euro Coin (EURC) to operate in compliance with the new regulations, effective immediately. This development alleviates concerns that investors would need to redeem their stablecoins or transfer funds to other digital assets to remain compliant.
Circle Expands into EU
In a strategic move, Circle has chosen France as its European headquarters, highlighting the country’s progressive stance on digital asset regulation and Circle’s collaborative relationship with the French Prudential Supervision and Resolution Authority (ACPR). Allaire emphasized the historical significance of the EU’s regulatory overhaul, recognizing it as the first comprehensive framework for digital assets, underscoring the maturity and legitimacy the asset class has achieved.
Circle CEO Weighs In
Reflecting on the journey, Allaire noted, “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.”
In response to the impending regulatory changes, several exchanges have adjusted their stablecoin policies. In June, Uphold, a crypto exchange and custodial platform, announced the delisting of six stablecoins for its European users, including Tether (USDT), Dai (DAI), TrueUSD (TUSD), Gemini Dollar (GUSD), Pax Dollar (USDP), and Frax Protocol (FRAX).
Bitstamp also reacted by delisting Tether’s EURT stablecoin, despite being one of the first exchanges to list the digital fiat token. Meanwhile, Binance adopted a “sell-only” strategy for certain stablecoin products in the European market. The world’s largest centralized exchange decided not to delist any stablecoins for its European users but opted to label fiat equivalents as compliant or non-compliant, limiting specific market features for customers in the region.
Stablecoin Dominance on the Rise
The dominance of stablecoins in on the rise due to a recent surge in their popularity. Circle CEO expects an explosive growth in the sector in the near future, adding that stablecoins could account for 10% of the global economic money within the next decade. This means that the stablecoin market would need to grow at a compounded annual growth rate of 47.7%, based on the current $80 trillion money market, of which 0.2% represents stablecoins.
Additionally, the stablecoin market cap also recent hit an all-time high following eight consecutive months of growth, as reported earlier by TheCoinRise. The impressive growth led to bullish predictions from the digital asset sector.
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