EU Fears Global Rush to Redeem USDC Through European Issuer

The stablecoin USDC has been at the center of a debate in Europe over its fungibility across jurisdictions.

Circle, the issuer of USDC, obtained an EU license via a French entity in 2024 but continues to issue USDC from the US, outside the scope of Europe's crypto law MiCA.

The European Central Bank (ECB) and the European Systemic Risk Board warn that strong EU redemption rules could trigger a global rush to redeem USDC through the EU issuer, draining reserves not sized for worldwide demand.

This raises regulatory and systemic risk for USDC and the broader stablecoin market.