EBA makes USDC the EU’s first significant e-money token

The European Banking Authority has classified USDC as the European Union’s first significant e-money token under MiCA, bringing specified parts of Circle’s supervision to the EU level. The Block reported the classification on October 15, citing the EBA’s announcement. The designation applies to USDC issued by Circle Internet Financial Europe SAS.

What supervisory duties move to the EBA?

According to The Block, the EBA will take direct responsibility from November 12 for supervising the issuer’s own funds, reserve assets, liquidity requirements, and recovery and redemption plans. Those areas are currently overseen by France’s Autorité de Contrôle Prudentiel et de Résolution, or ACPR.

The transfer is limited to those responsibilities. The ACPR will continue to supervise governance, qualifying holdings, fit and proper assessments, and conflicts of interest. USDC’s significant status therefore changes the division of supervisory work between the EBA and the French authority; it does not place every aspect of Circle’s oversight under the EBA.

The EBA also signed a memorandum of understanding with the New York State Department of Financial Services, which oversees Circle’s New York-regulated operations. The Block reported that the agreement is intended to support cross-border oversight and information exchange.

How does MiCA classify an e-money token as significant?

MiCA Article 56 requires the EBA to classify an e-money token as significant when at least three criteria listed in Article 43(1) are met in the first relevant reporting period or in at least two consecutive reporting periods. The criteria cover measures including holder numbers, token value or reserve size, transaction count and value, international activity, and links to the financial system.

National authorities report relevant information to the EBA and European Central Bank at least twice a year. The EBA prepares a draft decision when it concludes the criteria are met; the issuer and relevant authorities then have 20 working days to comment. The final classification decision is due within 60 working days of the draft notification. These rules make significance an assessment against specified criteria and reporting, rather than a designation based solely on a token’s name or market reputation.

The text of Article 56 in ESMA’s MiCA rulebook also provides for annual reassessment. If a token no longer meets the criteria, the EBA can remove its significant classification, after which supervisory responsibilities return to the issuer’s home authority.

What does the first designation establish?

The Block reported that USDC was the first of 45 e-money tokens notified in the bloc to meet the significance threshold. The distinction is regulatory: USDC remains an e-money token, while its classification changes which authority supervises defined issuer requirements.

For Circle, the immediate operational stake is the EBA’s oversight of own funds, reserves, liquidity, and recovery and redemption planning from November 12, alongside continuing ACPR supervision in other areas. The arrangement also gives the EBA and New York’s financial regulator a formal channel for exchanging information about the issuer’s operations across jurisdictions.

Sources and documents

• reported the classification — theblock.co
• text of Article 56 in ESMA’s MiCA rulebook — esma.europa.eu