Circle Wants EU’s 30% Stablecoin Reserve Rule Swapped for Liquidity Test - The Cryptonomist

Circle is reportedly urging European Union policymakers to reconsider a key provision of the Markets in Crypto-Assets (MiCA) framework that would require stablecoin issuers to hold up to 30% of reserves in bank deposits. According to The Cryptonomist, the company instead favors a liquidity-based test — a standard that would assess whether reserves can be converted quickly enough to meet redemption demand, rather than mandating a fixed share of deposits.

The distinction matters for how stablecoin issuers structure their reserves. A rigid deposit quota could push firms toward holding large balances in bank accounts, potentially at the expense of other high-quality liquid assets such as short-term government securities. A liquidity test, by contrast, would focus on an issuer's ability to honor redemptions under stress, which is the core risk stablecoin rules are meant to address.

For markets, the debate signals that MiCA's implementation details are still being shaped, and the outcome could influence where stablecoin issuers base operations and how they manage reserve portfolios. What to watch: whether EU authorities signal openness to revising the rule, and how other large issuers position themselves in the same consultation process.