Kraken is considering delisting Tether’s USDT due to EU MiCA regulations.
Marcus Hughes, Kraken’s regulatory strategy head, confirms the review and potential action.
Tether CEO noted exchanges will focus on Euro liquidity while maintaining USDT transactions.
Kraken, a major cryptocurrency exchange, is contemplating the delisting of Tether’s USDT stablecoin from its European platform in response to upcoming regulations from the European Union. Marcus Hughes, Kraken’s global head of regulatory strategy, confirmed this possibility in a recent interview with Bloomberg.
The European Union is poised to implement a new regulatory framework for digital assets, known as the Markets in Crypto-Assets (MiCA), in July. This framework is expected to introduce stringent regulations for stablecoins, potentially impacting the status of USDT within the European market.
“We’re absolutely planning for all eventualities, including situations where it’s just not tenable to list specific tokens such as USDT,” stated Hughes. He elaborated that Kraken is conducting a thorough review of the situation and will make definitive decisions as the regulatory landscape becomes clearer.
In response to Kraken’s considerations, Tether, the issuer of USDT, highlighted its expectation that European exchanges will prioritize euro liquidity for their customers while still potentially using USDT as a bridge currency for entry and exit from the crypto market.
Paolo Ardoino, Tether’s CEO, has previously expressed reservations about certain aspects of MiCA’s requirements. While Tether is currently engaged in discussions with regulators, Ardoino has indicated that the company does not plan to comply with MiCA regulations in the immediate future.
Earlier this year, another cryptocurrency exchange, OKX, made adjustments to its support for USDT within the EU. While OKX users can still deposit, withdraw, and convert USDT to euros, they can no longer use it for trading other cryptocurrencies on the platform.
The European Banking Authority (EBA) is finalizing the technical specifications for MiCA, with full implementation anticipated by 2025. Notably, the new regulations will require stablecoin issuers to obtain licenses within at least one EU member state and adhere to more rigorous standards for governance and reserve management.
This impending regulatory shift in the European Union underscores the evolving landscape for stablecoins and cryptocurrency exchanges. Kraken’s potential delisting of USDT reflects the challenges posed by MiCA, while Tether’s stance indicates a potential clash between regulators and stablecoin issuers.
The coming months will be crucial in determining how the European market adapts to this new regulatory framework and its impact on the broader cryptocurrency ecosystem.
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