Circle Presses the EU on Stablecoin Reserves

Circle on 1 October 2026 posted its answer to the European Commission's review of the European Union's crypto-asset law. The filing is the Circle MiCA review stablecoin reserves October 2026 in the form that matters for reserves: Circle wants the current bank-deposit floors replaced, and it wants two caps administered by the European Banking Authority taken off. The Block reported the same filing the same day and said the consultation closed on 30 September.

What happened

MiCA, the Markets in Crypto-Assets regulation, is the EU rulebook for crypto-asset issuers and for firms that serve that market. A review is the Commission's look at how that rulebook is working, run as a consultation. Circle's post says it answered that consultation.

The Block's date for the close is 30 September. Circle's public post is dated the next day, 1 October 2026.

A stablecoin is a token built to hold a steady value, usually against a currency, and typically backed by a pool of reserves. Circle's post makes a numerical claim about which of those coins sit inside MiCA. It says only three of the top 25 stablecoins by market cap are MiCA-regulated. The three it names are USDC, USDG, and EURC.

The post, as used here, does not name the rest of that group and does not give their market caps. This article does not fill those blanks.

On the rules themselves, Circle's asks are specific. It wants multi-issuance kept. Multi-issuance is the arrangement under which more than one entity issues the same stablecoin. It wants the bank-deposit reserve floor replaced with a liquidity rule.

That floor is 30 percent, and it rises to 60 percent if the coin is significant. A floor of that kind requires a set share of reserves to sit as deposits at banks. A liquidity rule, as Circle's contrast implies, would look instead at how readily reserves can be turned into cash.

Circle's post says it wants the floor replaced. It does not, in the facts used here, publish the clause-by-clause text of the substitute, and none is drafted here.

Circle also wants two EBA caps removed. The European Banking Authority is the EU body behind the caps. One cap is 35 percent on a single government, a limit on how much of the reserves can be exposure to one state's debt. The other is 1.5 percent of a bank's assets per counterparty, a limit that scales with the bank rather than only with the coin.

Removing a cap is not the same thing as describing a replacement. Circle's stated position is removal. The primary document is Circle's response. The Block's account of the filing, and of the 30 September close, is its 1 October report.

Why it matters

Reserve rules decide what sits behind a token that promises stability. If the backing is thin, or locked in the wrong place, the promise fails when many holders want out at once. MiCA's bank-deposit floor is a bet on one kind of backing: a large share, 30 percent or 60 percent, parked at banks. Circle's objection is not a quibble about a footnote.

Replacing that floor with a liquidity rule would change what issuers are required to optimize. A fixed deposit share pushes reserves into bank balances. A liquidity standard pushes them toward assets that can be turned into cash quickly.

Those are different balance sheets. Circle is asking Brussels to pick the second.

The two EBA caps push in a related direction. The 35 percent government cap stops an issuer from loading reserves onto a single sovereign. The 1.5 percent bank-asset cap stops a single counterparty relationship from growing large relative to the bank itself. An issuer that wants them removed is asking for more room in how reserves are allocated, both across governments and across banks.

Whether that room is safe is the Commission's question, not a conclusion this article reaches. What can be said from the filing is the request: keep multi-issuance, swap the deposit floor for a liquidity rule, and drop those two caps.

The market-structure claim gives the request its setting. If only three of the top 25 stablecoins by market cap are MiCA-regulated, then most of the largest coins, on Circle's count, sit outside the regime whose review Circle is answering. USDC, USDG, and EURC are the three it places inside. A review that changes reserve math will fall first on the coins that already opted into MiCA, or that were required to.

Circle's interest in the floor and the caps follows from that. It is writing as a firm that has to live with the reserve rules, about rules that, on its own figures, do not cover most of the large-cap field.

For related regulatory context, see SEC custody proposal and Polymarket safeguards.

What's next

The Commission has the response. Circle has published it. The Block has reported it, including the close of the consultation on 30 September. Nothing in those documents, as used here, is a decision.

Brussels has not adopted Circle's substitute, has not kept the floor, and has not said whether the EBA caps stay. A posted answer is a position. It is not an amended regulation.

The position itself is stable enough to quote as a list. Three of the top 25 stablecoins by market cap are MiCA-regulated, and Circle names them as USDC, USDG, and EURC. Multi-issuance should be kept. The 30 percent bank-deposit floor, 60 percent if the coin is significant, should be replaced with a liquidity rule.

The 35 percent single-government cap and the 1.5 percent bank-asset cap per counterparty should be removed. That is the whole of the ask this article is willing to state.