Circle has asked the European Commission to reduce entry barriers for crypto-asset service providers under its proposed Market Integration Package, a policy initiative designed to strengthen Europe’s capital markets. The company described the proposal as an important step toward a digitally enabled financial system but recommended targeted changes to improve adoption.
Circle submitted feedback on March 20, focusing on reforms to the distributed ledger technology (DLT) Pilot Regime and expanding the use of e-money tokens in financial settlement. The company argued that strict thresholds may limit participation and reduce liquidity across the crypto ecosystem.
Market Cap Limits Could Slow Euro Stablecoin Growth
Under current proposals, only “significant” e-money tokens would qualify for settlement use under rules linked to the Central Securities Depositories Regulation. Circle warned that these limits create structural barriers that could prevent euro-based tokens from gaining traction.
The company highlighted its euro-backed stablecoin, EURC, noting that no euro-denominated e-money token has yet reached the required market capitalization level. Circle recommended introducing more flexible thresholds based on liquidity and market adoption rather than fixed size requirements.
MiCA Framework and DLT Rules Face Industry Scrutiny
Europe’s primary crypto framework, Markets in Crypto Assets Regulation, came into effect in December 2024 but has faced criticism over complex interpretation and inconsistent implementation across member states.
Circle also proposed expanding access within the DLT Pilot Regime to allow crypto-asset service providers, not only traditional institutions, to manage certain accounts. The company said that balanced regulation connecting blockchain infrastructure with traditional finance could strengthen efficiency and market liquidity across the region.
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