Stablecoin giant Circle has a clear message to Brussels that it’s time to rethink crypto thresholds that are currently holding back real institutional adoption across Europe.
In its official response to the European Commission’s proposed Market Integration Package (MIP), the company praised the initiative as a “meaningful step toward a digitally enabled financial system” while calling out several areas that still need fixing.
Circle submitted its detailed feedback on March 20, highlighting how the MIP could enhance Europe’s capital markets. Among the key suggestions were reforming the Distributed Ledger Technology (DLT) Pilot Regime and opening the door wider for e-money tokens (EMTs) by letting more crypto-asset service providers jump in.
Circle aims to cut through the red tape and get blockchain and traditional finance working.
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Europe’s main crypto rulebook, the Markets in Crypto-Assets Regulation (MiCA), has been live since late 2024, yet it’s drawn plenty of flak from lawyers who say it’s tough to interpret and applied differently from one country to the next.
Circle believes the MIP offers a golden opportunity to bring much-needed legal clarity, especially by spelling out exactly which crypto assets can serve as collateral.
At the heart of its push, Circle is calling for lower crypto thresholds under the Central Securities Depositories Regulation. Right now, settlement is largely restricted to “significant” EMTs based on hefty market capitalization crypto thresholds. The company warns this setup risks shutting out euro-denominated EMTs entirely and creates a classic chicken-and-egg problem that stifles growth from day one.
“Restricting settlement to ‘significant’ EMTs risks excluding euro-denominated EMTs” and turns into “a structural barrier to institutional participation and secondary market liquidity,” Circle stated bluntly.
In other words, these rigid crypto thresholds are keeping serious players on the sidelines.
Circle seeking to expand EURC in the region with adaptive crypto thresholds
Beyond its USDC stablecoin, Circle also issues EURC a euro-backed, fully MiCA-compliant option that’s ready to roll in Europe. Yet no euro-denominated EMT has come anywhere close to hitting the current market cap crypto thresholds, leaving a massive gap in the market.
To fix this, Circle is advocating for more “adaptive crypto thresholds” that evolve with real-world conditions like market uptake, liquidity, and ongoing supervisory reviews. It also wants the DLT Pilot Regime expanded so crypto-asset service providers aren’t locked out of key cash account access.
The ball is now in Brussels’ court. If policymakers listen, the region’s digital finance future could look a lot brighter.
