Circle urges EU to accelerate distributed ledger reform and expand the scope of application of stablecoin settlement

According to TheBlock, stablecoin issuer Circle is urging European policymakers to accelerate updates to the EU digital asset framework, saying the delay could hinder institutional adoption of tokenized markets. In feedback, Circle said the plan was a "meaningful step" towards capital market modernization, but there were still gaps in scalability, regulation and settlement. Circle basically supports the proposed changes to the EU pilot system for distributed ledger technology, including expanding the scope of eligible assets and raising transaction volume thresholds, but said current restrictions still restrict liquidity and institutional participation. The company recommended introducing an "adaptability" threshold linked to market conditions and called for an accelerated transition path to permanent rules during the pilot phase. On settlement, Circle welcomed the proposal to include e-currency tokens in cash settlement, but warned that limiting the use of only "important" tokens could exclude euro-denominated stablecoins and slow down adoption. The company also called for allowing crypto service providers, rather than just banks and central securities depositaries, to provide settlement accounts, and pushed for clearer rules to allow stablecoins to be used as collateral.