Circle’s USDC has become the first e-money token in the European Union to receive the “significant” classification under the Markets in Crypto-Assets Regulation (MiCA). The decision will bring the dollar-backed stablecoin under direct supervision by the European Banking Authority (EBA) for specific financial requirements starting November 12, 2026.
The EBA announced the decision on October 14 after assessing USDC under the EU’s crypto regulatory framework. Of the 45 e-money tokens notified under MiCA, USDC is the first to receive this designation.
The new arrangement divides supervisory responsibilities between the EBA and France’s financial regulator, the Autorité de Contrôle Prudentiel et de Résolution (ACPR).
USDC is pegged to the US dollar and is the world’s second-largest stablecoin by market capitalization. Circle issues the token through separate entities in Europe and the United States.
The classification follows an assessment under MiCA, which allows an e-money token to be designated significant when it meets at least three specified criteria. These cover factors such as the number of holders, transaction activity, token value and the extent of its use.
The EBA’s announcement did not specify which individual criteria USDC met.
The decision does not mean USDC is entering the European market for the first time. Circle has operated under the EU framework since 2024, when its French subsidiary received authorization to issue USDC and its euro-backed stablecoin, EURC.
The new status introduces additional supervisory requirements because of the token’s significance under MiCA.
EBA will oversee USDC’s reserves and financial safeguards
Starting November 12, the EBA will directly supervise several financial requirements associated with USDC.
Its responsibilities will include monitoring Circle’s own-funds requirements, reserve assets, liquidity arrangements, and recovery and redemption plans.
Own funds are the financial resources an issuer must maintain to meet its regulatory obligations. Reserve assets support the stablecoin’s value and help the issuer meet redemption requests, while liquidity requirements ensure assets are available when needed.
Recovery plans establish how an issuer should respond to financial difficulties. Redemption plans cover the arrangements for tokenholders to exchange their tokens for the underlying funds under applicable rules.
France’s ACPR will continue overseeing other aspects of Circle’s European operations, including corporate governance, ownership assessments, senior management suitability, outsourcing arrangements and potential conflicts of interest.
The two regulators will work together where their responsibilities overlap. MiCA establishes this division of authority for significant e-money tokens, transferring specific financial oversight duties to the EBA without removing the national regulator from the process.
The classification therefore does not place every aspect of Circle’s European business under the EBA. Instead, it creates a shared supervisory structure with defined responsibilities for each authority.
Circle has called for changes to Europe’s stablecoin rules
The decision comes as Circle has urged European policymakers to reconsider parts of MiCA’s requirements for stablecoin reserves.
In early October, the company argued that rules requiring issuers to keep a minimum portion of their reserves as bank deposits could expose them to risks associated with their banking partners.
MiCA sets minimum deposit requirements for reserve assets, with stricter provisions applying to certain significant issuers. Circle has called for an approach that places greater emphasis on reserve liquidity rather than fixed deposit thresholds.
The company has pointed to its experience during the 2023 collapse of Silicon Valley Bank, when approximately $3.3 billion of USDC reserves temporarily became inaccessible.
Circle has also proposed changes to the treatment of cross-border stablecoin issuance and the recognition of regulated issuers operating outside the EU.
The company has argued that relatively few major stablecoins meet Europe’s regulatory requirements. In an earlier assessment, it identified USDC, EURC and USDG among the tokens it considered compliant.
However, the EBA’s October 14 decision does not change MiCA’s existing rules. It applies the current framework to USDC and establishes the additional supervisory arrangements scheduled to begin in November.
EU and New York regulators agree to share information
The EBA also confirmed that it had signed a memorandum of understanding with the New York State Department of Financial Services (NYDFS).
The agreement provides for cooperation and information sharing related to cross-border stablecoin activities. It is intended to support supervision when stablecoin issuers operate through entities in different jurisdictions.
USDC is issued through Circle’s European subsidiary and its US entity, placing the stablecoin within separate regulatory systems.
The agreement will allow the EBA and New York authorities to exchange relevant supervisory information. It does not replace either regulator’s legal responsibilities, and the announcement did not provide further details about how the information-sharing arrangements will operate.
The agreement comes as international regulators continue examining the risks posed by stablecoins that operate across national borders and financial sectors.
MiCA also provides for supervisory colleges involving relevant financial authorities. These groups help regulators exchange information and coordinate oversight of significant e-money tokens.
The EBA will continue assessing whether USDC meets the criteria for significant status under the regulation.
Under the announced timetable, the authority will take over its designated responsibilities for USDC’s reserves, liquidity, own funds, and recovery and redemption arrangements on November 12, 2026. France’s ACPR will retain oversight of governance, ownership assessments, outsourcing and conflicts of interest.
