The European Union’s Markets in Crypto-Assets Regulation (MiCA) is enforcing stricter oversight of crypto-related firms, and cryptocurrency exchange Coinbase is the latest to update its offerings in response.
On Oct. 4 Bloomberg reported that Coinbase will delist stablecoins that do not comply with EU regulations by the end of 2024. This move aligns with the full implementation of MiCA, which is set to tighten control over the digital asset sector.
Coinbase to restrict noncompliant stablecoins
In a statement released Friday, Oct. 4, a Coinbase spokesperson reaffirmed the company’s commitment to regulatory compliance:
“Given our commitment to compliance, we intend to restrict the provision of services to EEA users in connection with stablecoins that do not meet the MiCA requirements by December 30, 2024.”
Coinbase also indicated that users in the European Economic Area (EEA) will be offered conversion options to compliant stablecoins, such as Circle’s USD Coin (USDC), in the coming months. Circle was one of the first stablecoin issuers to comply with MiCA’s regulatory requirements.
MiCA, which began regulating stablecoin issuers on June 30, mandates that all stablecoins available in the EEA must hold an e-money license in at least one EU member state.
This regulation directly affects leading tokens like Tether’s USDt (USDT), which may be forced off the Coinbase platform unless it obtains the required authorization.
Sprint to compliance
Coinbase is one of many exchanges working to meet MiCA requirements as the European Union prepares to enforce the regulations. Other crypto platforms like OKX, Bitstamp, and Uphold have already taken steps to limit the availability of noncompliant stablecoins, including USDT.
With competition in the stablecoin market heating up, companies like Robinhood and Revolut are exploring the development of their own stablecoins to challenge the dominance of Tether and Circle.
France-based fintech company Next Generation and Ireland-based electronic money institution Decta announced a plan to reintroduce a euro-pegged stablecoin, EURT, on the Stellar blockchain. They will leverage MiCA’s regulatory clarity to tap into the growing demand for euro-backed digital assets.
Meanwhile, USDC is experiencing a surge in trading volume, particularly in response to the growing demand for regulated digital currencies in Europe. In July, just after stablecoin-related regulations came into force in the EU, USDC’s trading volume soared by 48%.
With USDC positioned as a leading MiCA-compliant stablecoin, Coinbase’s plans to offer conversion options could further solidify its market presence in the region, making it a preferred choice for users seeking regulatory-approved digital assets.
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