THE REAL DEAL Circle Payment Network
for investors and traders. It’s also been used for things like offshore gambling and the like. “Now we are seeing its evolution into mainstream use cases – cross border payments, remittances within and between emerging markets and large corporate treasury.” Evidence for this development into the mainstream is demonstrated by the mainstream banking groups that sit alongside BCB in the Circle payments network including Société Générale, Deutsche Bank and Standard Chartered. “We are definitely beginning to see corporate level use cases for stablecoins, because they’re more trusted now. USDC and EURC are trusted because they’re transparent, regulated, and you have visibility as the owner of the value of the coin in terms of reserves. “From a corporate point of view it's definitely regarded as more of a cash equivalent asset,” says Tonkin. This also echoes BCB’s growing number of direct relationships with banking groups. The future potential of stablecoins, however, will also depend upon a different type of stability and consistency – regulation. With different jurisdictions taking different approaches to stablecoins a global standard is lacking. Europe has established a relatively clear regulatory regime under MiCA, US regulation of stablecoins is expected to emerge later this year and is expected to be far less stringent.
→ “[Circle] went out into the market and looked for who were the key players in this space. We are sitting in the heart of that ecosystem and so were an absolutely logical choice to be one of its large partners,” said Tonkin. Regulatory first vital to attracting corporate users The partnership also reflects a shared approach to regulation between Circle and BCB. Both groups have embraced the European Union’s Markets in Crypto Assets (MiCA) regulations and are authorised by the same French authorities as Electronic Money Institutions – the core requirement for a MiCA compliant stablecoin issuance. Tonkin believes this shared regulatory first approach was an important factor in the partnership. Like many crypto businesses BCB regards MiCA as imperfect but nevertheless a valuable foundation for the next stage of crypto’s evolution, in particular in the adoption of stablecoin as a medium for international corporate and institutional transfers. Tonkin regards the regulatory-first approach and the development of new partnerships as the most positive way for stablecoin to make the next step into the financial mainstream. “Stablecoins of all kinds have been popular for a while, but the use cases have sometimes been quite esoteric and largely within the crypto native community, for example as a tool for treasury management by exchanges or as a kind of reserve
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