Circle urges UK to blend MiCA and US rules for stablecoins

Circle’s policy chief Dante Disparte urged the United Kingdom to combine the European Union’s MiCA framework with elements of the U.S. GENIUS Act when drafting stablecoin rules, testifying Wednesday before the House of Lords Financial Services Regulation Committee in London. He framed the approach as a way to protect users and keep issuance and payments activity in the UK.

Disparte pointed to MiCA for clarity on definitions, licensing, governance and consumer safeguards, and to the U.S. law for reserve, redemption and transparency standards that support issuance and redemption at scale. “The model is clear: take the best of both and make it distinctly British,” he told the committee.

He warned that leaving stablecoins outside a clear regime would push activity offshore, increase risks for UK users and erode London’s position as a financial center. “From Europe, take clarity, definitions, licensing, governance and strong consumer protection; from the U.S., the GENIUS Act,” he added.

Addressing concerns about pressure on bank deposits and funding, Disparte argued that well-regulated stablecoins can coexist with traditional finance. “The future is not banks versus stablecoins,” he told lawmakers, adding that strong reserve and liquidity requirements, along with bank participation, can manage risks. “Our growth across currencies and jurisdictions is proof that trusted stablecoins expand markets. They do not shrink them.”

He outlined four principles for the UK approach: full one-to-one reserve backing for stablecoins, holding high-quality liquid assets to support those reserves, enforceable redemption rights for users, and robust transparency on reserve composition and liquidity.

Jesse McWaters, executive vice president and head of global policy at Mastercard, appeared alongside Disparte. In his view, stablecoins do not present a near-term threat to domestic payment options such as cards because they currently lack a clear value proposition for consumers. At the same time, he pointed to cross-border uses. “Blockchain technology, the rails on which stablecoins run, provides a new, innovative and potentially significantly additive way of moving money, particularly in cross-border contexts,” McWaters noted.

The hearing forms part of a broader UK review of crypto oversight. The Financial Conduct Authority is consulting on a crypto asset regime expected to take effect on October 25, 2027, after which companies conducting newly regulated activities would need authorization.

Circle issues USDC, the world’s second-largest stablecoin by market capitalization. MiCA, the EU’s first comprehensive crypto framework, began applying to crypto-asset service providers on December 30, 2024. In the United States, the GENIUS Act was signed into law on July 18, 2025, creating a federal framework for stablecoin issuance and oversight.

Disparte maintained that the UK could benefit from MiCA’s predictability while adopting reserve, redemption and transparency standards aligned with the U.S. approach to support safe issuance and closer integration with the banking sector. Without such a framework, he cautioned, UK consumers could face higher counterparty risks when using offshore stablecoins and domestic firms could lose ground to jurisdictions with clearer rules.

As we reported earlier, a Bernstein research note projected a 70% upside for Circle, citing growing USDC use in payments and new AI-driven flows such as micropayments for compute, data and machine-to-machine transactions. The note said stablecoins are likely to see more real-time, cross-border and small-value payments, while stressing that regulatory treatment, reserve transparency and integration with existing payment rails will shape adoption. U.S. regulators have increased scrutiny of stablecoins, and Circle has highlighted compliance and regular reserve reporting.