European Banking Authority ranks Circle USDC as the first significant stablecoin under MiCA

Unpublished qualification under the MiCA scheme

On Wednesday 14 October 2026, the European Banking Authority announced that the USDC issued by Circle as a "significant" electronic money token under the European regulation on crypto-active markets (MiCA), reported the Journal du Coin and Cryptoast. Of the 45 e-money tokens reported and notified within the European Union, the dollar-backed stablecoin is the first to pass this regulatory step, with none of the 44 other assets in this category having reached this status.

According to the European texts cited by the Journal du Coin, the MiCA framework distinguishes between two levels of supervision for tokens backed by an official currency. Circle's French subsidiary already had electronic money issuer status since July 2024. Higher ranking is activated when an asset meets several predefined thresholds. According to the Journal du Coin, Article 43 lays down four criteria for assessing the number of users, the overall amount outstanding, the daily volume of transactions and the importance in international payments, with Article 56 providing for a switchover if three criteria are met. For its part, Cryptoast mentions a grid of seven potential criteria, including the crossing of 10 million porters or 5 billion euros of reserves, while observing, like the Journal du Coin, that the regulator has not made public the precise list of criteria validated by the USDC.

Shared supervision between the European level and the CPRA

This prudential shift will take effect on November 12, 2026 and will result in double regulatory oversight, explains Le Coin Journal and Cryptoast. The European Banking Authority, based in Paris, will provide direct supervision of liquidity, equity, financial reserves and recovery and repayment protocols.

The Supervisory and Resolution Authority, the supervisor of the banking sector in France, will retain the supervision of the management structure, internal governance and conflict of interest management of Circle's tricolor subsidiary. The Journal du Coin further states that the European Banking Authority will lead a college of institutional supervisors and will rely on an information exchange protocol with the New York State financial authorities responsible for the supervision of Circle in the United States.

Increased constraints on bank reserves

The qualification as a significant token requires an operational tightening for the issuer. According to the technical details detailed by Cryptoast, Circle will now have to deposit at least 60% of its total reserves in banking institutions, whereas this requirement was set at only 30% for ordinary issuers. At the same time, the level of capital buffer required increases from an average of 2 % to 3 % of the reserves.

This mechanism raises questions about Circle's business model. According to Cryptoast, the company's revenues are mostly derived from returns from U.S. Treasury bills on reserves, which generated $668 million in interest in the second quarter of 2026, representing 95% of its revenues. The requirement to direct an increased proportion of funds towards less remunerative bank deposits could affect these revenues. Circle also disputes this regulatory direction: the Journal du Coin recalls that at the beginning of October 2026, the issuer requested that the fixed deposit thresholds be relaxed in favour of liquidity criteria, citing the freezing of $3.3 billion in assets during the failure of Silicon Valley Bank in March 2023. This 60% bank deposit constraint has also been described as risky by Paolo Ardoino, head of Tether, explaining in part his refusal to run for MiCA approval, says Cryptoast.

Two different trajectories in the face of European requirements

This decision comes at a time when the stablecoins market has a clear concentration. The USDC ranks second in the world with $73 billion worth of valuation, behind Tether's US$184 billion USDT, says Cointelegraph, the Journal du Coin and Cryptoast. In the absence of an application for MiCA registration, USDT has been dereferenced by platforms regulated on European territory, according to the Journal du Coin. In the market for tokens denominated in European currency, Circle also holds 40 to 50% of the volume of its segment thanks to its EURC token, notes the Journal du Coin.

Despite discussions about the predominance of foreign currencies, several professionals in the sector stressed the need to maintain a supervised dollar offer. James Bennett, leader of Stable Mint, told Cointelegraph that the European Union could not rule out dollar-backed assets but had to set the framework for them. Alexander Höptner, leader of the AllUnity company, who is nevertheless developing a token backed by the euro, said that an offer that is exclusively denominated in a single currency did not meet the international flows of European companies. In parallel, the European Central Bank continues its work on a digital euro launched in 2020, with a potential maturity of 2029, Cointelegraph recalls.

Operational deployment and local tax rules

In terms of transactions, USDC is strengthening its presence in European investment services. For example, since July 2026, the Finst platform has been negotiating over 400 crypto-actives directly against the USDC, says Cryptoast. This technical structure allows French tax residents to reallocate their portfolios without triggering immediate taxation, as taxation only intervenes when converting to a currency such as the euro, the specialist publisher adds.

On trading platforms, the USDC traded at €0.89 on Friday, October 16, 2026 at 13:39, showing a decrease of 0.32% over a 24-hour period, according to CoinGecko's figures.