Coinbase is preparing to delist non-compliant stablecoins on the European market, as the EU’s MiCA is set to come into force soon. From Dec. 13th, Coinbase Europe, Coinbase Germany, and Coinbase Custody International plan on delisting Tether’s USDT, and five other stablecoins that do not conform with MiCA.
Coinbase seeks to bring its operations within MiCA’s framework, under which firms must be authorized in at least one EU country to continue operating.
MiCA’s stablecoin rules, in effect since June 30, stipulate that issuers need to have a EU e-money license. The regulation, MiCA (Markets in Crypto Assets), will start to take force on Dec. 30. Coinbase and other exchanges are preparing for full enforcement of the regulation by asking users to convert their noncompliant stablecoins into regulations such as USDC.
Challenges for stablecoin issuers adapting to MiCA compliance
While Coinbase names USDT a “MiCA-restricted stablecoin,” the Token has not yet been officially declared non-compliant by European regulators. The European Securities and Markets Authority (ESMA) overseeing MiCA compliance has not clarified USDT’s legal standing. The unclear status of USDT shows the challenges stablecoin issuers face under the new regulations.
Other exchanges, such as Binance, have also begun adjusting to MiCA regulations. Binance announced to list Eurite (EURI). Moreover, Binance listed a MiCA-compliant Euro-backed stablecoin, EURI, to meet regulatory requirements. It also launched a zero-fee trading promotion for EURI pairs to boost liquidity and attract more users.
Tether adapts to MiCA with new compliant stablecoin projects
Under MiCA regulations, Tether, the USDT issuer, has been scrutinized. However, the company remains dedicated to transitioning to the European market. Last month, Tether stopped issuing its euro-backed stablecoin, EURt, because of low interest from the community. At the time, USDT’s total value was more than 400 times larger than EURt’s market cap.
Tether will also support new MiCA-compliant stablecoins such as EURq and USDq stablecoins by Quantoz Payments. Tether’s CEO, Paolo Ardoino, criticized some issues with MiCA but also stated that it is a good act to advance the cryptocurrency market. As mentioned, as MiCA enforcement approaches, exchanges like Coinbase, Binance, and others prepare, while stablecoin issuers will need to adjust similarly.
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