Navigating the future of digital asset regulation

Patrick Hansen, Senior Director at Circle, explores how the evolving digital assets policy impacts both businesses and consumers.

Why is having a well-structured crypto policy essential for companies operating in the digital asset space?

A clear and well-defined crypto policy ensures consumer protection, financial stability, and rules-based innovation and competition. Without regulatory clarity, businesses face uncertainty, limiting their ability to scale or secure investments and institutional partnerships. Particularly in the European Union, having a harmonised crypto rulebook across the 27 EU member states allows crypto businesses to address a larger market. Sensible regulation also promotes trust among users and institutions, which is critical for mass adoption and long-term industry success.

What are the core principles that guide Circle’s approach to crypto regulation and compliance?

At Circle, we pride ourselves on being a regulation-first actor that goes through the front door in every major jurisdiction in the world. We built our regulatory positioning on transparency, compliance, and financial integrity. This is how we have managed to become the only major global stablecoin issuer to adhere to stablecoin-specific rules, including in Canada and the MiCA framework in the EU.

What challenges has Circle faced in adapting its policies to evolving regulatory frameworks like MiCA?

Regulatory evolution inevitably requires some operational recalibration. However, at Circle, we see much of the oncoming legislation as aligning with Circle’s existing business model rather than requiring fundamental change. While we’ve made some structural adjustments to ensure full regulatory alignment, our core framework for reserve management, licensing, and compliance reporting was already built for this level of oversight. One major challenge for both policymakers and operators in the stablecoin space alike is how to create compatibility and interoperability between stablecoin frameworks in various jurisdictions. With more and more countries opting to adopt new regulations, regulatory reciprocity, recognition and harmonisation will become increasingly important to prevent national fragmentation of rules.

MiCA has been a game-changer for regulatory clarity. How is it being implemented so far, and what challenges exist in its enforcement?

MiCA is a significant step forward in setting clear rules for crypto assets across the EU. Its implementation is a marathon, not a sprint. We started building out our MiCA operations and licence applications over two years ago, and with some of the implementing regulations and guidelines still to be adopted by the EU, this work has never stopped. A major topic of ongoing discussion has been the dual categorisation of Electronic Money Tokens (EMTs) as crypto-assets and e-money. To achieve its goal of fostering regulated crypto-asset services in the EU, it is key that EU authorities avoid duplication of licensing and applicable rules here for actors providing stablecoin-related services in the EU.

Where does MiCA fall short, and what gaps still need to be addressed in the EU’s crypto regulatory landscape?

While MiCA is comprehensive, it is a product of its time, and some topics should be closely looked at in its upcoming EU Commission interim review 2025. As mentioned earlier, the EU should look into how to align its regime with other new frameworks being adopted in other jurisdictions. The EU should carefully evaluate the attractiveness of its stablecoin rules overall, addressing key concerns around duplication of requirements under MiCA and PSD. The EU will also consider gaps on other topics like decentralised finance (DeFi) or non-fungible tokens (NFTs), but at this stage, I believe both the industry and the EU institutions favour fully implementing and improving existing MiCA rules instead of creating additional ones.

How does MiCA compare to regulatory approaches in the US and Asia? Do you see it influencing global standards?

MiCA provides the most comprehensive framework for stablecoins and crypto assets to date, offering greater clarity than the currently fragmented regulatory landscape in the US at the state and federal level, where multiple agencies oversee different aspects. In Asia, regulatory approaches vary widely, from innovation-friendly frameworks in Singapore to more restrictive policies in China. MiCA’s unified approach is setting a precedent that could influence global standards, but much will depend on a pragmatic implementation in the upcoming 12-18 months.

What advice would you give to startups or enterprises navigating crypto regulations for the first time?

First, stay proactive — regulations evolve quickly, and understanding upcoming requirements early can prevent costly adjustments later. Also, if you can, engage with policymakers and industry groups to stay ahead of regulatory changes and contribute to shaping a strong crypto sector in your region.

Second, and I can’t stress this enough, start early. Adherence to frameworks like MiCA takes a lot of time.

Looking ahead, what’s next for EU crypto policy? Could we see further refinements or even a MiCA 2.0?

The EU will likely refine MiCA over time, but for now, it is all hands-on deck for implementation. Many crypto-asset service providers, like large exchanges, are yet to be authorised under MiCA. So, the focus should be on resolving current challenges and addressing existing regulatory uncertainty and bottlenecks first. Additionally, as global regulatory discussions progress, we may see greater harmonisation between MiCA and international standards, reducing fragmentation across jurisdictions.

 

This editorial piece was originally published in The Paypers’ Web 3 Payment Acceptance Report 2025. The report highlights the current landscape of Web 3 payments, including their rapid growth, high adoption rates, and underlying drivers. It also explores key players in the field, regulatory advancements, the role of AI in crypto and blockchain, and more.

 

Author the author 

 

Patrick Hansen is the Senior Director of EU Strategy & Policy at Circle, where he leads Circle’s regulatory strategy and engagement across the European Union. Circle is a global fintech company at the forefront of digital financial infrastructure, issuing USDC and EURC stablecoins, and providing developer services that enable secure and efficient financial transactions.

 

 

About Circle

Circle is a global financial technology firm providing digital financial infrastructure, including USDC and EURC stablecoins. Circle’s solutions empower businesses and developers to build on blockchain technology with trust, transparency, and compliance.