The European Union (EU) has introduced [Markets in Crypto-assets proposal (MiCA)](https://www.consilium.europa.eu/en/press/press-releases/2022/06/30/digital-finance-agreement-reached-on-european-crypto-assets-regulation-mica/), a framework for regulating the crypto market in the continent. On 01 July 2022, a MiCA reporter, Stefan Berger, took to Twitter to announce that Europe has become the first continent to have a regularised crypto policy. 

![MiCA.png](https://s3.eu-west-2.amazonaws.com/prod-monitalks-media/Mi_CA_136bb478bb.png)

Berger mentioned that the Parliament, Council, and Commission have approved a balanced MiCA framework. In addition, he indicated that PoW technology will not be banned; however, crypto issuers will be accountable for energy consumption and its impact on the environment. 

Where MiCA regulation has rejected the ban on PoW technology, it might still affect the digital asset market in various ways. One of the most affected crypto-assets can be stablecoins like EUROC and others. 

## MiCA’s harsh regulations for stablecoins like EUROC

The EU-endorsed MiCA framework has a dedicated section for stabilising stablecoins, including the [Euro coin](https://www.monitalks.io/news/article/euro-coin). The framework has considered the recent crash of Terra Luna, a stable cryptocurrency and formed policies to protect crypto consumers. 

For this reason, the framework proposed certain strict measures that the stablecoin issuers would have to take to mitigate instability and risk. Here are the proposed MiCA regulations for the stablecoins like EUROC:


1.	Stablecoin issuers must have an adequate liquid reserve with a 1:1 ratio.
2.	Stablecoin consumers can claim the token at any time without any additional fee.
3.	All stablecoins will be supervised by the European Banking Authority (EBA.)
4.	Non-European currency-based asset-referenced tokens will be regulated to ensure Europe’s ‘monetary sovereignty.’
5.	Asset-referenced token issuers would need to register themselves in the EU. 

## The stance of Circle’s Euro coin (EUROC) 

According to the Head of Global Policy and Chief Strategy Officer of Circle, Dante Disparte believes that:

>  “MiCA regulation will be to crypto what GDPR was to privacy.” 

Though many crypto users call MiCA a crack-down on the crypto market, Disparte reflected that MiCA policy will likewise work as a guiding framework for crypto issuers and consumers. 



MiCA regulations impact on EUROC and other stablecoins

The release of Euro Coin (EUROC) was announced by global fintech firm, Circle, on Thursday, June 16, 2022. Circle is the same firm that launched the [United States Dollar Coin (USDC)](/coins/usdc). Like USDC, Euro Coin will be a fully reserved, Euro-backed stablecoin. 

## How the Euro-backed stable coin works

The Euro Coin will function the same way as the Dollar Coin. Thus, 1 EUROC and 2 EUROC will be the equivalent of €1 and €2 respectively. 

As a regulated stablecoin, Euro Coin will be issued under the same full-reserve model of USDC. More importantly, the stablecoin was built on the same standards of security, transparency, and trust that have made USDC one of the most used digital currencies in the crypto finance space. 
 
Circle’s introduction of EUROC will help bridge traditional financial services and cryptocurrencies. Several businesses that do not have direct access to the Euro can use EUROC tokens as on-demand liquidity (ODL) to make and accept payments globally which settle in minutes.
 
Aside from this, the Euro Coins as a tradable token can be used to access crypto capital markets such as lending, borrowing, and trading. 

To ensure the security of the stablecoin to help prevent the ghosts of TerraUSD (UST), Circle has ensured that EUROC has 100% backing of euro-denominated reserves held conservatively in the custody of some of the leading institutions in the financial sector of the United States regulatory perimeter such as Silvergate Bank. 

Speaking on the [launch of EUROC](https://www.circle.com/en/pressroom/circle-announces-a-fully-reserved-euro-backed-stablecoin-euro-coin-euroc), co-founder and CEO of Circle, Jeremy Allaire said, “There is clear market demand for a digital currency denominated in Euros, the world’s second most traded currency after the U.S. dollar. With USDC and Euro Coin, Circle is helping to unlock a new era of fast, inexpensive, secure, and interoperable value exchange worldwide." 

Starting from June 30, EUROC will be made available to institutional clients through a free Circle Account. Uniswap, Huobi Global, Bitstamp, Curve, and Binance.US are among the exchanges that will be supporting the stablecoin. 

This will play an invaluable role in the lives of millions of people who would love to go about their financial lives with EUROC rather than USDC or other currency-backed stablecoins.


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