EU regulators name Circle’s USDC as first 'significant' stablecoin

The European Banking Authority (EBA) issued the decision on October 14, selecting USDC from 45 notified e-money tokens for the heightened oversight tier. Under the new arrangement, the EBA will directly manage financial safeguards, including reserve asset management, liquidity requirements, capital thresholds, and recovery plans. France’s Autorité de Contrôle Prudentiel et de Résolution (ACPR), which previously served as the primary regulator for Circle’s European operations, will retain authority over governance, senior management assessments, and potential conflicts of interest.

This division of labor is mandated by MiCA for tokens deemed systemic in size and financial activity. While the classification formalizes the EBA's role, Circle continues to issue USDC through its French subsidiary, maintaining the regulatory base established in 2024. To manage the complexities of a token issued across multiple jurisdictions, the EBA has finalized a memorandum of understanding with the New York State Department of Financial Services. This agreement facilitates information sharing between European and American regulators, addressing concerns raised by international bodies like the Financial Stability Board regarding the risks of global, cross-border stablecoin operations.