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Cryptocurrency firm Circle announced on Monday that it is now registered as an electronic money institution (EMI) in France, securing a significant license to issue stablecoins in compliance with the European Union’s stringent crypto regulations.
Launched in 2018 by Circle, USD Coin (USDC) has become the second-largest stablecoin globally, with over $30 billion worth of tokens in circulation.
Circle, known primarily for USDC, received an e-money license from France’s banking regulator, the Autorite de Controle Prudentiel et de Resolution (ACPR). This approval makes Circle the first global stablecoin issuer to achieve compliance with the EU’s Markets in Crypto-Assets (MiCA) regulatory framework.
With this license, both USDC and Euro Coin (EURC) are now issued in the EU in line with MiCA’s stablecoin regulatory requirements. Circle is also expanding its Circle Mint service, which allows businesses to mint and redeem Circle stablecoins, in France.
“Since our founding, Circle has sought to build durable, compliant, and well-regulated infrastructure for stablecoins,” said Jeremy Allaire, co-founder and CEO of Circle. “Our adherence to MiCA, one of the most comprehensive crypto regulatory regimes in the world, is a huge milestone in bringing digital currency into mainstream scale and acceptance.”
Stablecoins are cryptocurrencies pegged to traditional assets, such as government-issued currencies like the U.S. dollar. Investors use them to avoid the volatility seen in other cryptocurrencies like bitcoin and to facilitate quick trades without relying on fiat currencies stored in bank accounts.
EU regulators passed the world’s first comprehensive cryptocurrency law last year, outlining rules for investor protections and platform security. Known as MiCA, the law officially took effect in May 2023, with provisions for stablecoins approved only recently. These measures are considered stringent, imposing limits on trading volumes for certain stablecoins, particularly those denominated in U.S. dollars.
Under MiCA’s rules, companies must stop issuing non-euro-denominated stablecoins as a “means of exchange” if they exceed 1 million transactions or a value of over 200 million euros ($215.2 million) per day, according to Article 23.
As a France-registered EMI, Circle can now offer its services, including USDC minting and redeeming via Circle Mint, to customers throughout the European Union. MiCA allows crypto businesses to offer services in one EU country and “passport” them to other markets within the bloc.
The remaining MiCA obligations, which apply to crypto asset service providers, will become effective by December 30, 2024. Crypto companies will have until July 2026 to become fully compliant with MiCA.
Launched in September 2018 by Circle and crypto exchange Coinbase, USDC is the second-largest stablecoin globally, with $32.4 billion worth of tokens in circulation, according to CoinGecko data. It ranks second only to Tether’s USDT, the largest stablecoin with $112.7 billion in circulation.