Circle Urges EU to Accelerate DLT Reforms, Proposes Introduction of Dynamic Threshold Mechanism

Gate News reports that on March 23, stablecoin issuer Circle submitted feedback to the European Union regarding the “Market Integration Plan,” urging for accelerated reform of digital asset regulatory frameworks. Circle stated that this plan is an important step toward modernizing capital markets but still has shortcomings in scalability, regulatory mechanisms, and settlement rules. The current progress may slow down institutional adoption of tokenized markets. Circle supports optimizing the Distributed Ledger Technology (DLT) pilot framework, including expanding the range of assets and increasing transaction size limits, but noted that existing restrictions still suppress liquidity and institutional participation. The company recommends introducing a “dynamic threshold” mechanism to allow regulatory parameters to automatically adjust based on market development, rather than relying on periodic legislative updates. Additionally, Circle calls for a clear pathway from the pilot phase to a formal regulatory system and warns that slow regulatory progress could lead to tokenized financial activities shifting to faster-developing markets like the United States.