Stablecoin issuers & crypto Exchanges are under hurdle in EU countries: MiCA vs stablecoin

On Jun 5, 2024

Reportedly the majority of the Stablecoin issuer companies are in huge hurdles over the upcoming stablecoin regulatory framework of EU MiCA.

As we know, the European Union’s (EU) crypto regulatory framework Markets In Crypto Assets (MiCA) is in effect & covering the regulation of stablecoins in step-by-step phases for the last few months.

To comply with the EU’s stablecoin regulatory structure, top crypto exchange Binance decided to restrict the access of unauthorised stablecoins for EEA users.

As per the announcement, Binance will convert functions for unauthorised Stablecoins to a “sell-only” mode. EEA users will be allowed to sell unauthorised Stablecoins for other digital assets, like Bitcoin or Ethereum, or regulated Stablecoins. They will be also allowed to exchange for fiat, depending on local availability, from 30 June.

Major changes coming in European digital asset markets on June 30th with the effectiveness of MiCA Stablecoin Regulations.

👀https://t.co/viVsJnCJ4k
— Jeremy Allaire (@jerallaire) June 3, 2024

So far Binance didn’t use the name of any stablecoin under the restricted list but Binance CEO Richard Teng said that Binance will not delist any stablecoin but limit the availability & features for EEA users.

I just wanted to take a moment to address one of the bigger questions raised about our strategy for the upcoming MiCA stablecoin rules.

Please be assured that Binance won't delist any unauthorized stablecoins on spot but will limit their availability for EEA users only on…
— Richard Teng (@_RichardTeng) June 3, 2024

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Following this new announcement by Binance regarding EU stablecoin regulation, Paolo Ardoino, the CEO of USDT stablecoin issuer firm Tether, expressed the concerns associated with MiCA’s stablecoin regulation framework.

Paolo said that regulatory requirements would mainly complicate the work of stablecoin issuers. They would make EU-licensed stablecoins extremely vulnerable and riskier to operate.

2/2)
As with any regulatory framework of this scale, further discussions on the technical implementation standards are crucial to providing clarity to the market over certain provisions,
— Bitcoinik (@Bitcoinikdotcom) June 5, 2024

Reportedly other crypto firms, OKX and Kraken, are also evaluating how the new MiCA rules will affect them. Last month, a report mentioned that Kraken was considering whether to remove USDT.

Later Kraken executives dismissed such reports & said that they aimed to provide USDT stablecoin support continuously but they keep monitoring the new rules to comply with stablecoin regulatory standards.

https://t.co/4HEyhlJ8eN #Kraken Crypto Firm Executive Says “No Plans To Delist #USDT Stablecoin”
— Bitcoinik (@Bitcoinikdotcom) May 19, 2024

In March, TheBlock reported that OKX stopped supporting USDT trading pairs in Europe.