Top US cryptocurrency exchange Coinbase has warned its users yet again. It has announced that
it could delist stablecoins that have not complied with the Markets in
Crypto-Asset Regulations (MiCA), including Tether’s USDT stablecoin.
Coinbase’s warning comes as the enforcement deadline
approaches for the most significant crypto regulations. According to
information reportedly sent to users, Coinbase Europe, Coinbase Germany, and
Coinbase Custody International will stop supporting a total of six stablecoins
by December 13.
E-money Authorization Requirement
According to the crypto exchange, this move aligns
with MiCA’s e-money authorization requirements, which require that stablecoin
issuers must have regulatory approval in at least one EU member state. Thus, Coinbase has urged users to convert their
holdings in non-compliant coins into alternatives such as USD Coin (USDC),
which complies with MiCA standards.
ICYMI: As of today, @coinbase is notifying European users of the restriction of stablecoins that don’t meet MiCA requirements 🇪🇺On #Algorand, two options are fully MiCAR-compliant and can be legally used in the EEA by 450 million people:1️⃣ $USDCa from @circle #Algorand is… pic.twitter.com/iPULEjjFjP
— Algorand Foundation (@AlgoFoundation) December 11, 2024
MiCA is the EU’s landmark cryptocurrency regulation.
It seeks to standardize the industry and protect users. Its provisions on
stablecoins have been in effect since June 30, while the full implementation
for exchanges and other companies is set for December 31.
Tether, the world’s largest stablecoin issuer with a
market cap of nearly $140 billion, has yet to gain the necessary authorization
to operate in Europe, according to a recent report by Bloomberg. Other
exchanges like OKX and Bitstamp have already restricted access to Tether’s USDT
in anticipation of the regulation.
Support for Euro-Pegged Stablecoins
Even as other assets face delisting, Coinbase has also
reaffirmed its support for EURC, a euro-pegged stablecoin jointly operated with
Circle. These coins comply with MiCA, offering users a secure alternative
amidst the regulatory changes.
The implementation of the MiCA regulations has also
pushed some exchanges and digital asset issuers to reevaluate their strategies. For instance, Robinhood and Revolut are reportedly
considering launching their stablecoins. Coinbase plans to provide an update next month about
further actions and options for users to navigate these changes.
Interestingly, Coinbase also disclosed last month that it will suspend USDC rewards for holders in the European Economic Area, a move also aimed at MiCA compliance. The program enables users to earn yields for holding USDC on the exchange. It was reportedly available in several regions, with yields varying per region.
This article was written by Jared Kirui at www.financemagnates.com.
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