Hyperliquid Policy Center, Circle press EU on perps and stablecoin reserves in MiCA review

The Hyperliquid Policy Center and stablecoin issuer Circle have filed separate responses to the European Commission's review of the Markets in Crypto-Assets Regulation, joining a consultation that opened on May 20 and closed on Sept. 30 after the original Aug. 31 deadline was extended.

HPC, the Washington-based advocacy group launched in February and funded with 1 million HYPE tokens then worth about $29 million from the Hyperliquid Foundation, argued in a Sept. 30 letter signed by CEO Jake Chervinsky that perpetual futures should be regulated as derivatives under MiFID II rather than under MiCA. The group said MiFID II's Annex I derivative categories already capture perps, so "clarity in application, rather than new legislation" is what is needed. It also pushed back on lumping perps together with contracts for difference, which ESMA restricted for retail traders in 2018, noting that a CFD provider profits when its client loses while a perps order book venue is not the counterparty. HPC asked the Commission to require venues to publish funding methodologies, maintenance margins and liquidation thresholds in advance, and to confirm that listing a regulated product on a public blockchain does not by itself change its classification. It cited Hyperliquid's HIP-3 markets as an example; those markets briefly accounted for 75% of Hyperliquid's trading volume in late July, though that share has since fallen to roughly a quarter. The filing was HPC's first outside the US, following a similar pitch to the SEC and CFTC in August.

Circle targets reserve floor

Circle, which has issued USDC and EURC in the EU through its French entity since July 2024 and calls itself the largest MiCA-authorised e-money token issuer, focused on the regulation's reserve requirements. Under current rules, EMT issuers must hold at least 30% of reserves in commercial bank deposits — 60% if the European Banking Authority labels the token "significant." Circle said the floor increases exposure to the banking sector's credit and counterparty risk, a risk it experienced in March 2023 when USDC briefly lost its $1 peg after the company disclosed that $3.3 billion of its roughly $40 billion in reserves sat at Silicon Valley Bank. It said it concurs with the ECB and the European System of Central Banks, which also called for scrapping the deposit minimums in favour of a "less rigid minimum asset liquidity requirement." Circle's director of EU strategy and policy, Patrick Hansen, detailed the submission in a blog post; the company declined to share the full filing.

Circle also wants two EBA technical standards dropped: a 35% cap on exposure to any single government, which it says makes it impossible for dollar-denominated tokens to hold mostly US Treasurys, and a 1.5% limit on exposure to any one bank's total assets, which would force large issuers to work with dozens of banks. It defended multi-issuance arrangements, where an EU-authorised entity and a foreign-regulated affiliate co-issue the same global stablecoin, saying restrictions would push usage outside the EU's perimeter. The ESCB, however, said MiCA needs legal clarification on whether third-country multi-issuer schemes are permissible. Deutsche Börse Group filed on Sept. 29, proposing a separate category for "settlement EMTs" used as the cash leg in regulated settlement systems, and the Chamber of Progress filed on Sept. 30, backing token rewards and multi-issuance with enforceable EU redemption rights.