Banking Circle Adopts USDC
- Banking Circle intends to extend its payment options outside of the traditional banking system.
The European bank, Banking Circle, which handles cross-border payments, has announced support for the US dollar-pegged stablecoin, USDC. The financial institution, which is also regulated by the EU, announced that USDC will become a payment acceptance, settlement, and processing option.
Banking Circle noted that this new payment option is geared toward offering payment providers as well as banks, multiple payment streams outside conventional banking channels. The European financial institution announced that it had enlisted the services of the popular crypto exchange, Coinbase, as one of its liquidity providers.
Established in 2016, Banking Circle runs with the goal of assisting payments firms in expanding into new countries while avoiding the administrative hassles associated with the conventional banking system. The Luxembourg-based organization also operates in other parts of Europe alongside the United Kingdom.
The adoption of USDC is a huge move towards embracing the crypto space, especially as assets such as stablecoins are yet to be fully recognized by financial institutions. A statement by Banking Cirlce’s head of virtual assets, Mishal Ruparel, stated that the new feature signaled the company’s growing interest in digital assets which it believes has a role to play in the future global economy.
He further noted that it’s essential that banks and payment processors be capable of handling some forms of cryptocurrencies as they process fiat currency. Banking Circle sees its integration of stablecoins as a step in the right direction.
The financial platform said in its statement,
We already have client demand for paying out in cryptocurrency, which they want to do in a way that is trustworthy and lower risk. We will, therefore, provide the facility to convert fiat to stablecoins in USDC, giving financial institutions the ability to send funds in stablecoin easily and with full regulatory compliance.
Following its recent update, Banking Circle plans to serve as a bridge between fiat bank accounts and stablecoins. According to Mishal, the organization is committed to providing payment solutions that are suitable for future use.
New European Rules for Stablecoins
As part of a historic initiative by the EU to regulate the seemingly lawless industry, new rules in the European Union necessitate that stablecoin suppliers keep reserves like that of banks and that crypto firms operate with a mandatory license.
The European Council and Parliament recently reached an agreement on the Markets in Crypto-Assets (MiCA) proposal, almost two years after deliberations began. The plan, which is subject to final approval will be the first full attempt in regulating the crypto industry.
In line with the MiCA regulations, cryptocurrency service providers will be accountable if they misappropriate investor funds and be bound by European market-abuse laws, such as those prohibiting insider trading and financial fraud.
A statement from Bruno Le Maire, the French minister for the economy, finance, and industrial and digital sovereignty said,
Recent developments on this quickly evolving sector have confirmed the urgent need for an EU-wide regulation. This landmark regulation will put an end to the crypto wild west and confirms the EU’s role as a standard-setter for digital topics.
The new regulations addressed several parts of the crypto market including its interest in stablecoins. Digital assets pegged to the euro or the dollar are subject to additional regulations laid down in MiCA. Large stablecoin issuers will be subject to stringent regulations from MiCA, including giving holders prompt redemption rights. If stablecoins are extensively utilized as a form of payment, the regulation stipulates that there will also be constraints on the number of transactions that may be made each day, which will be limited to €200 million ($208 million).
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
