- Circle supports the Swiss stablecoin framework, including reserve backing and client protections.
- The company calls for equivalence-based rules to recognize regulated foreign stablecoins.
- The USDC issuer proposes targeted refinements for transparency, risk-based capital, and global alignment.
The USDC issuer Circle has voiced its support for Switzerland’s proposed stablecoin framework. The stablecoin giant has praised the proposal’s safeguards for consumers, market integrity, and innovation. The proposal sets standards for licensed crypto and payment institutions. It includes measures such as capital requirements and technology-neutral regulations.
However, the company also called for a global perspective. Circle noted that foreign-issued stablecoins should be recognized if prudently regulated abroad, helping Switzerland stay connected to the $300 billion global stablecoin market and cross-border payment systems.
Circle Backs Swiss Stablecoin Rules
Stablecoin giant Circle reportedly responded to Switzerland’s proposed updates to the Financial Institutions Act (FINIG). The proposal aims to create licensing rules for payment and crypto institutions. The bill will also introduce a new set of rules for fiat-backed stablecoins.
As per reports, Circle welcomed the Swiss stablecoin rules, highlighting key features such as full reserve backing, client asset protection, enforceable redemption rights, proportionate capital requirements, strong AML controls, and a tech-neutral approach that leaves non-custodial wallets unregulated. According to Circle, these measures promote consumer protection, market stability, and innovation.
Flexible Pathway for International Stablecoins in Switzerland
The platform also raised concerns about foreign stablecoins. The draft rules treat foreign-issued stablecoins the same as unbacked crypto, even if they are fully regulated in the country. Circle warned that this could isolate Switzerland from the global stablecoin market, which is now worth over $300 billion and widely used for cross-border payments, treasury operations, and on-chain settlements.
The company also pointed out that other regions like the EU and the US have already recognized foreign e-money or stablecoins under specific frameworks.
As a resolution to this issue, Circle recommended that Switzerland create a clear equivalence-based path for foreign stablecoins that are fully regulated in their home countries. Under this approach, FINMA would recognize third-country rules that are broadly similar in goals and oversight, without requiring them to be exactly the same. Stablecoins approved this way could be treated in Switzerland like money for accounting, regulatory, and operational purposes.
As a backup, Circle suggests a limited registration or recognition process so that globally regulated stablecoins aren’t automatically treated as unbacked cryptocurrencies.
In addition, Circle also suggests specific improvements to make Switzerland’s stablecoin framework more effective and globally aligned. These include recognising disclosures from issuers, like MiCA compliant whitepaper; providing clear rules for redemption rights and processes so users can access their fiat quickly and reliably; and setting capital requirements based on actual operational and technological risks rather than just token volume.
The stablecoin company also supports risk-based AML/CFT control instead of universal whitelisting, bringing crypto-asset transfer services under the regulatory scope, and using transparent fees instead of automatic token supply cuts if negative interest rates return. Together, these refinements aim to boost transparency, financial stability, and consumer trust while staying in line with international regulatory standards.
Exploring Global Stablecoin Regulation
Circle’s recommendations come amid a broader worldwide push to regulate stablecoins in a safe, consistent way. In the European Union, the Markets in Crypto Assets (MiCA) regulation recognizes e-money tokens as “money-like instruments” and sets clear rules for issuers, including disclosure requirements, capital standards, and consumer protections.
Meanwhile, in the US, the GENIUS Act and other regulatory initiatives aim to provide a framework for stablecoins used in payments, emphasizing reserve backing, transparency, and AML compliance.
