Circle director sees potential in EU payment rules for stablecoins News ▸ EU ▸ Stablecoins
Circle director sees potential in EU payment rules for stablecoins
Hansen noted that the proposed review should allow stablecoin issuers easier access to opening bank accounts.
2 min read
Updated: Sep. 19, 2023 at 2:10 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Patrick Hansen, Director of E.U. Strategy and Policy at Circle, said the planned review of E.U.’s payment rules would significantly benefit stablecoins, granting issuers access to the central bank payment systems, according to a Sept. 19 post on X (formerly Twitter).
The proposed review
The proposals to review E.U. Payment rules were first published on June 28 as the Third Payment Services Directive (PSD3) and a Payment Services Regulation (PSR). The proposal looks to regulate electronic payments and the banking ecosystem in the European Union’s single market.
Speaking on the review, Eric Ducoulombier, Head of DG FISMA Unit at the European Commission, described the proposals as evolving the payments sector.
Ducoulombier highlighted several benefits of the review, including:
“[The modification of] the Settlement Finality Directive (SFD) to enable non-banks to access payment systems. We also propose remedies to the recurring ‘de-risking’ problem faced by some Payment Institutions (PIs) and E-money Institutions (EMIs), which should substantially improve their capacity to open and maintain bank accounts.”
And
“Explicitly recognize the possibility for a self-regulatory market space to exist in addition to the regulated sphere. This is a particularly important acknowledgment of ongoing initiatives such as the SEPA Payment Account Access (SPAA) scheme, in which the European Payments Council (EPC) is playing a leading role.”
How will this benefit stablecoins?
Hansen noted that the proposed review would allow stablecoin issuers easier access to opening bank accounts. He added that the review was a good innovation to increase competition in the E.U. payment sector.
“Stablecoin (EMT) issuers will be able to access central bank payment systems, safeguard funds with the central bank, and should have less trouble opening bank accounts.”
Stablecoins are cryptocurrencies that attempt to peg their market value to some external reference. These assets have come under intense scrutiny following Terra’s algorithmic UST stablecoin collapse last year. Following this, governments across different jurisdictions introduced new measures designed to regulate the industry and prevent a future recurrence of similar events.
Despite this, CryptoSlate reported that fiat-backed stablecoins eclipsed Mastercard and PayPal in moving more value across their networks.
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Posted In: EU, Stablecoins
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Circle
Circle Internet Financial Ltd is a global internet finance company, built on blockchain technology and powered by crypto assets.
Patrick Hansen is a Director, EU Strategy and Policy Advisor at Circle, a global financial technology firm that enables businesses of all sizes to harness the power of digital currencies and public blockchains for payments, commerce and financial applications worldwide..