Stablecoins in Payments: Regulation, Qualification Debates & Market Opportunities MiCA, PSD3 &Beyond

Transcript

Is it working? Yes. Hi everyone. Uh so Yeah, it's my first time, so I'm going to try and understand all others work, but do not hesitate if you have any question at the end of this presentation. So today we are talking about stable coin and uh how they are reshaping the payment uh infrastructure. Uh just to present myself, I'm Julie Bader. I'm a fintech lawyer at Gaulle Florence. And I work with financial institution and fintech players uh in the crypto uh area. And for instance, we assisted a Circle to um for for them to obtain the the license

the MiCA license to issue uh USDC and EURC in France and in the EU. Um So we we we as a lawyer, we have the opportunity to see the project from the beginning and we we can see uh what is happening in the in the crypto and the payment uh area. And what is happening with stable coin and payment is that it's a major shift that we see on payment. So as you may know, stable coins have exploded uh from uh 1 year between 2024 and 2025, we have a 50% uh increase of stable coin circulation.

Uh we have today around 270 uh billion dollar uh stable coin in circulation. So that is a big growth, but the growth of circulation is not the real story there. We see that the the the the major shift is the the change in the payment infrastructure. And so what we see is that companies that are using stable coins for payroll, for payments, for cross-border treasury management, there is no longer crypto experimentation. It's using crypto stable coins in the real uh business.

What also we see is that stable coin, they are not really replacing payments. They are reshaping the payments and rewriting the rails for payment. And this is not theory. Today we really see um from our client and the project that we assist what is going on. Uh for instance, you may have seen that Circle uh um has partnered with a Visa to uh allow USDC settlement transaction. We have also a lot of payment platform that are using stable coin for payouts and marketplace that are using stable coin for management of uh reimbursement.

Why is that is there uh this use this usage of stable coin? It's because it allow real-time settlement. They are available 24/7. And it implies lower costs. But the real innovation is not the token in itself, is the infrastructure behind it. And we we see that all the players, they are adapting to this uh new infrastructure and all stable coin works. There is a lot of talk about banks being uh quite behind on this uh innovation, but what we see as as lawyer is that the banks they are moving towards stable coin by becoming um custodian for the reserve. We also uh

see a lot of payment provider that are that are integrating stable coins and crypto firm that are partnering with licensed institution. So stable stable coins is hitting uh payments quietly. And it's uh happening in a regulated uh environment, of course. Uh and so as you may know, in EU, we have the MiCA regulation that uh as is applying to a stable coin and enter into application uh mid-July 2024. And um Circle was one of the first to obtain its license to issue a stable coin uh in compliance with MiCA.

And um What is uh what is happening with MiCA is that it's created a regulated crypto asset that is stable coin based on euro crypto currency um legal currency. But also it allow uh um define framework for the stable coin uh issuance in uh the EU. So MiCA is a specific regulation, but as stable coins are not only crypto, they also are e-money, they also are uh subject to the e-money directive that is a other EU regulation. And as stable coin are used as payment instrument, they also are subject to the PSD2, the

payment uh services directive. And so what we we face in France and in EU EU uh is that we have a lot of a complex web of regulation that is applying to stable coins and has to be tackled on by uh actors and issuers and payment institutions so that they can use stable coin in uh regulated framework in the EU. Some say that the EU is blocking innovation by all this regulation, but what we can see is that even in the US, the regulation that is going to be applicable to stable coins is really close to what we have in in the EU in MiCA.

And so uh it's our opinion as lawyer that as long as you are compliant with EU regulation, it will be easy to comply with the US regulation and all regulation around the globe that will be inspired by the MiCA regulation. So in practice, uh we we see that it's very easy to already regulated institution to go to stable coins activities because they already are regulated. And uh they are already ready uh on internal compliance or AML/CFT um because they already have this infrastructure. But they lack the

technological knowledge and infrastructure of crypto. And so it's what we see, there is a convergence between the banks, the traditional financial institution, and the crypto pure player that knows all all about this uh these things. What what we say to our client is that compliance is being a real advantage for all the players. Uh for example, Circle is the the the company that chose choose to to be regulated. The first regulated entity in the EU and today they are the leaders uh on that. And they will be also the leaders in the US because they they they have

they have chosen to go to uh to compliance. So what we say is that regulation is not slowing down innovation, is structuring the market. And you have to understand this in order to succeed in the crypto and the stable coins market. What we say is that the players who will succeed are the ones who understand both regulation and technology. And so without them, you cannot scale compliantly and become the next leader in the stable coins area.

So thank you. It was a short presentation, but if you have any question, do not hesitate. Same questions? I think yeah. Okay. Thank you everyone. Do not hesitate if you have a if you want to Oh. I fell. There you go.