Circle Urges EU to Ease Rules for Crypto Service Providers

Circle asks EU to update crypto rules, saying easier regulations will help banks and companies use stablecoins and digital assets safely.

Circle, the company behind the USDC stablecoin, asked the European Commission to update crypto rules. The request was made on March 20, 2026 as feedback on the Market Integration Package. This plan is aimed at modernizing Europe’s financial system and improving the capital markets. Better rules could help institutions use digital assets more easily, Circle said.

Circle Requests Changes to Support Tokenized Markets

Circle said the proposal is a good step towards a digital financial system. However, the company explained that there are still some rules governing growth. It cautioned about delays in updating, which could serve to slow institutional adoption. Therefore, Circle asked policymakers to improve the supervision, rules for settlement and scalability.

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One of the major requests is on the DLT Pilot Regime. This program is used to test blockchain-based financial markets. Circle supported expansion of the program but said limits remain too strict. The company recommended flexible thresholds so the institutions can participate without delays.

Circle also asked for a clear path of making the pilot program permanent. The current proposal calls for a report by 2030 before changes occur. Circle said investors require certainty before they can build out long-term systems. Faster reforms could help Europe remain competitive in digital finance.

Stablecoins and Crypto Firms Need Clearer EU Framework

Another problem is e-money tokens for payments for securities trading. These tokens include stablecoins that comply with MiCA’s rules. Circle said all tokens that are approved should be permitted for settlement. Limiting usage to large tokens may slow the market growth.

The company also sought approval for permission for crypto-asset service providers to manage token accounts. Current rules apply only to banks and central securities depositories. Circle said it would make the system more efficient by allowing licensed crypto firms. This change could also facilitate cross-border digital payments.

Circle continued a discussion of supervision rules under MiCA regulation. The company agreed that there is a need for strong oversight of large crypto firms. However, it said smaller companies should remain with national regulators. Too many authorities reviewing a single firm could slow innovation and drive up costs.

Another of the recommendations centered on the use of stablecoins as collateral. Circle said clear laws are required in order for tokens to be used safely. Updates to financial regulations could help to bring in digital settlement tools in the market. The company pointed out that the U.S. and the U.K. are conducting studies of similar systems.

The Market Integration Package is a part of Europe’s plan to create better capital markets. Officials want to link traditional finance and blockchain technology. Circle said clear and fair rules could bring more liquidity and efficiency to Europe.

Circle confirmed that it will keep working with European regulators. The company said that stablecoins like USDC and EURC can support modern finance. With updated rules, banks and institutions are allowed to use digital assets more confidently. The decision made by the European Commission may determine the future of crypto markets in Europe.