Introduction
The European Union has introduced the Markets in Crypto Assets Regulation (MiCA) to make digital asset markets more secure, transparent and stable. To maximize investor protection, this regulation requires issuers to obtain licenses from the EU member states in which they operate, hold at least 60% of their reserves in low-risk European banks, and provide regular, transparent reporting. In this way, it is aimed to provide a solid and auditable basis for the stablecoins that will take place in the market, while contributing to the sustainability of financial innovation.
MiCA Regulation and Implementation Criteria
The MiCA regulation requires certain criteria to ensure investor safety and increase transparency in the financial system. Issuers must obtain licenses from the EU member states in which they operate. In addition, within the scope of reserve management, firms are required to hold at least 60% of their reserves in low-risk European banks. This practice helps to minimize potential risks by creating an important buffer against market volatility. Regular reporting and transparency standards support the establishment of an environment of trust in the market by ensuring that investors receive continuous information.
Stablecoin Issuers Approved Under MiCA
The stablecoin issuers covered by MiCA include Banking Circle, Circle, Crypto.com, Fiat Republic, Membrane Finance & Quantoz Payments, as well as established names such as Schuman Financial, Société Générale, StabIR and Stable Mint. Banking Circle blends traditional financial infrastructure with modern digital solutions, distinguished by its broad customer portfolio and robust payment systems. As the issuer of the USDC stablecoin, Circle offers regulatory compliance and high transparency standards on a global scale, while Crypto.com develops products that meet MiCA criteria with its user-friendly platform, comprehensive ecosystem and advanced technological infrastructure. Fiat Republic stands out with innovative solutions that facilitate the integration of digital assets into fiat money, while Membrane Finance and Quantoz Payments stand out in the market with their rigorous risk management and liquidity provision practices. Schuman Financial, Société Générale, StabIR and Stable Mint are symbols of trust and stability in the market with their authorization to issue stablecoins indexed to 10 euro and 5 US dollars.
Status of Tether (USDT)
Tether (USDT), the largest stablecoin by market capitalization, is not approved under MiCA regulation. According to current information, the company is taking important steps to increase financial transparency and regulatory compliance. For example, the appointment of Simon McWilliams as CFO on March 3, 2025 demonstrates Tether’s commitment to strengthening its oversight processes. Furthermore, the High Court of London’s rejection of some of Tether’s claims in its legal dispute with former business partner Swan Bitcoin highlights the challenges Tether faces in the legal process. These developments reflect the strides Tether has made in financial transparency, regulatory compliance and market stability.
Binance’s EU Regulatory Decision and Transition to MiCA Compliance
Binance has made an important strategic move by deciding to stop the use of stablecoins that violate MiCA regulations. This decision applies specifically to the European Economic Area (EEA). The EEA includes not only EU member states, but also non-EU countries such as Iceland, Liechtenstein and Norway. Affected assets include USDT, FDUSD, TUSD, USDP, DAI, AEUR, UST, USTC, and PAXG. By removing stablecoins from its platform that do not comply with these regulatory requirements, Binance underscores its strategy to direct its users to trade MiCA-compliant alternative assets.
Conclusion
While the MiCA regulation introduces important standards to ensure order, transparency and investor protection in the European digital asset market, approved stablecoin issuers ensure confidence and stability in the market by complying with the set criteria. While Tether’s failure to be approved under MiCA highlights the importance of alternatives that comply with regulatory standards, Binance’s decision to delist MiCA non-compliant stablecoins within the EEA demonstrates how regulations shape market dynamics. These regulatory steps support the sustainability of financial innovation and contribute to a more robust and reliable environment in the EU digital asset ecosystem.
