The European Banking Authority classified Circle's USDC as the first "significant" e-money token under the EU's Markets in Crypto-Assets regulation on Wednesday, 14 October, a designation that hands Brussels direct supervisory power over Europe's largest regulated stablecoin and marks the first real test of MiCA's tiered oversight regime for digital currencies.
Joint supervision between the EBA and France's Autorité de Contrôle Prudentiel et de Résolution begins on 12 November, with the transfer of supervisory competence set to take four weeks. Under the new arrangement, the EBA will oversee USDC's capital position, reserves, liquidity and recovery and redemption plans, while the ACPR retains responsibility for governance of the issuer, including its executives. The EBA has also signed an information-sharing protocol with New York's financial regulator, which supervises Circle in the United States, allowing the two authorities to coordinate oversight of a token that now sits at the centre of both jurisdictions' stablecoin frameworks.
The significance designation stems from Article 43 of MiCA, which sets four criteria for e-money tokens — the number of holders, circulating value, daily transaction volume and the weight of cross-border payment use. Under Article 56, a token crosses into "significant" status once it meets three of the four. The EBA notified 44 other tokens that did not cross that threshold, out of 45 e-money tokens now recorded by the authority in total.
USDC currently carries a market capitalisation of approximately $73 billion. Circle's French subsidiary has held an e-money issuer licence since July 2024, giving the company an early foothold in the bloc's regulated market. By the end of July, only three stablecoins among the global top 50 by market capitalisation had passed the MiCA filter — USDC, Circle's euro-denominated EURC, and USDG — against roughly 30 licensed e-money tokens issued by around 20 companies across the EU. EURC holds an estimated 40 to 50 percent share of its market segment.
Tether stays outside the perimeter
Tether's USDT, with a market capitalisation of $184 billion, remains outside the regulated EU market. The company has never applied for MiCA authorisation, and regulated European platforms have already removed USDT from their offerings as a result. The gap has not gone unnoticed among firms building euro-based alternatives. Alexander Höptner, chief executive of AllUnity, said: "For European companies to be able to make cross-border payments on a global scale, offering only a euro stablecoin is not enough."
The EBA's move also revives memories of USDC's most serious stress episode. In March 2023, $3.3 billion of Circle's reserves were frozen following the collapse of Silicon Valley Bank, a episode that briefly knocked the token off its dollar peg and underscored the reserve and liquidity risks that the EBA's new supervisory mandate is designed to monitor directly.
For now, USDC stands alone as the only token subject to this heightened tier of EU oversight, a status that gives Circle a regulatory head start in Europe even as the stablecoin market's largest player by size continues to operate beyond MiCA's reach.
