EBA Names USDC EU’s First Significant E-Money Token

The European Banking Authority (EBA) has classified Circle’s USDC as the European Union’s first significant e-money token under the Markets in Crypto-Assets Regulation (MiCA), expanding the EU’s direct oversight of one of the world’s largest dollar-backed stablecoins.

Announced on October 14, the decision follows the EBA’s assessment of MiCA’s significance criteria. USDC is the first of 45 e-money tokens notified under the EU framework to receive the classification, according to the regulator.

The new supervisory arrangements will take effect on November 12, shifting responsibility for several key prudential requirements from France’s Autorité de Contrôle Prudentiel et de Résolution (ACPR) to the EBA.

EBA Takes Over Key USDC Supervisory Responsibilities

Under the new arrangements, the EBA will directly supervise USDC issuer Circle Internet Financial Europe SAS in areas including own funds, reserve assets, liquidity requirements, and recovery and redemption plans.

The ACPR will retain responsibility for other supervisory matters, including governance, qualifying holdings, assessments of the suitability of key individuals, outsourcing and conflicts of interest. The two authorities will work together to coordinate the transition.

The classification does not replace Circle’s existing obligations under MiCA. Instead, it places USDC within the regulation’s enhanced supervisory framework for significant e-money tokens, which are subject to additional requirements because of their potential scale and links to the wider financial system.

Under MiCA, an e-money token can be classified as significant when it meets at least three of the regulation’s specified criteria. These cover factors used to assess a token’s size, activity and potential importance to the financial system.

EBA and US Regulators Establish Cooperation Framework

The EBA also announced a memorandum of understanding with the New York State Department of Financial Services (NYDFS). The agreement is intended to facilitate cooperation and information exchange between the authorities concerning cross-border stablecoin activities.

The arrangement adds an international coordination element to USDC’s new supervisory status, as the stablecoin is issued by separate Circle entities in the European Union and the United States.

The EBA’s announcement does not indicate that USDC’s classification changes its dollar peg or guarantees its value. Rather, it determines how the EU will supervise the token’s issuer in specified areas under MiCA.

USDC’s Classification Follows Circle’s Push for MiCA Changes

The decision comes as Circle continues to engage with European regulators over the implementation of the bloc’s stablecoin rules.

In October, Unlock Blockchain reported on Circle’s call for changes to MiCA’s stablecoin framework, including concerns about how certain reserve requirements could affect the operation of global stablecoins in Europe. The company has also advocated for regulatory clarity around stablecoins used in payments and financial-market infrastructure.

The new classification marks a further step in the implementation of MiCA’s enhanced oversight regime. For Circle, it means key areas of USDC’s prudential supervision will move to the EBA, while France’s ACPR continues to oversee governance and other responsibilities.

The EBA said it will assess annually whether tokens continue to meet the applicable significance criteria. USDC’s designation therefore forms part of an ongoing supervisory process rather than a permanent status.