Stablecoin issuer Circle is calling on the European Commission to rethink parts of its proposed Market Integration Package (MIP), arguing that current rules could slow down the growth of crypto-based finance across the region.
In its recent feedback, Circle described the MIP as a positive step toward building a more digitally advanced financial system in Europe. However, the company also highlighted key areas where changes are needed to make the framework more practical and inclusive for crypto market participants.
Circle Pushes for Lower Barriers to Entry
One of Circle’s main concerns is the high market capitalization threshold required for euro-denominated stablecoins, also known as e-money tokens (EMTs), to be used in financial settlement.
According to the company, no euro-backed EMT—including its own stablecoin EURC—has come close to meeting the proposed threshold. This creates a situation where these assets cannot gain adoption because they are restricted, yet they cannot grow because they lack adoption.
Circle argues that this “chicken-and-egg” problem is holding back innovation and discouraging institutional participation. Lowering these thresholds or making them more flexible based on real market conditions, such as liquidity and usage, could help unlock growth in the sector.
The company also emphasized that restrictive rules may limit secondary market activity and reduce overall efficiency in Europe’s evolving crypto ecosystem.
Expanding Opportunities for Crypto Service Providers
Circle also pointed out limitations in the current Distributed Ledger Technology (DLT) Pilot Regime. As it stands, only traditional financial institutions like banks and central securities depositories can manage cash accounts under the framework.
The company believes this approach excludes crypto-native firms that could play a major role in advancing blockchain-based finance. Allowing more crypto-asset service providers to participate would encourage competition and innovation.
Circle’s recommendations build on the foundation of the Markets in Crypto-Assets Regulation, which came into effect in December 2024. While MiCA aims to standardize crypto rules across Europe, it has faced criticism for being complex and inconsistently applied across different countries.
