A statement from publicly traded Coinbase announced that the leading exchange was delisting all unauthorized stablecoins from its EU exchange by the end of the year. Tether Holding’s USDT would be among the most affected stablecoins as MiCA preps to implement the new regulations fully.
The statement revealed that MiCA’s regulation of stablecoin issuers in the EU took effect on June 30. Exchanges in the region would need to be ‘e-money’ authorized by at least one of the EU’s member states before the new rules kicked in on December 31st, 2024 going forward. Coinbase said it would provide updates for its plans in the next few months, but it hinted that USDT users could convert their stablecoins to Circle’s USDC, which was EU-compliant.
Coinbase makes plans to delist stablecoins unauthorized in the EEA
Coinbase will delist all unauthorized stablecoins from its crypto exchange in the European Economic Area by year-end https://t.co/oWBra5ruiQ
— Bloomberg (@business) October 4, 2024
Coinbase announced its intention to delist Tether’s non-EU-regulated USDT from its exchange in the EEA by the end of this year. The exchange disclosed the possibility of replacing USDT with Ripple’s RLUSD as the upcoming MiCA-led changes to stablecoin support in the EEA took effect. It also stated that more details regarding EEA customers’ transition plans would be shared in November, adding that it would include options for switching to MiCA-compliant stablecoins such as EURC and USDC.
A Coinbase spokesperson claimed the exchange would only provide services to EEA users with MiCA-approved stablecoins. As per the Coinbase statement, Revolut Ltd and Robinhood Markets were among the companies considering challenging Tether’s 66% stablecoin market share dominance. Tether had yet to get MiCA’s greenlight to offer its $120 billion USDT in Europe.
A customer support message exposed by crypto commentator MartyParty confirmed that the Sychelles-based OKX crypto exchange delisted its USDT trading pairs for EEA users ahead of MiCA’s new stablecoin oversight rules. The leak revealed that OKX intended to avail only USDC and EUR, as it promised over 30 new EUR spot trading pairs.
The Bretton Woods Committee observed that both local and global stablecoin offerings would either comply with MiCA’s new rules or disappear in the short to mid-term from the EU crypto market. The Committee added that the delisting or phasing out of non-EU-regulated tokens by exchanges like Kraken and Binance was evidence of the EU’s zero-tolerance for loosely regulated ‘internet funny money’.
MiCA’s impact on the EU stablecoin market
The Kaiko research team reported that MiCA’s impending regulations would shake up the stablecoin market, leading to the potential delisting of non-compliant stablecoins by leading exchanges. It added that Euro-backed stablecoins have consistently grown in volume since the beginning of 2024 despite Europe traditionally trailing the U.S. and APAC in crypto trading activity.
Bitstamp reportedly delisted its euro-denominated stablecoin EURT issued by Tether. Uphold also confirmed that it delisted six unauthorized stablecoins for European users, although it continued to support PYUSD, USDC, and EURC.
The team disclosed that fiat-backed stablecoins under MiCA would be categorized as ‘e-money tokens’ in the bloc, and other asset-backed tokens would be ‘asset-referenced tokens’. Notably, the regulations would restrict the daily transaction limit for non-euro-pegged stablecoins to $1 million.
USD-backed stablecoins continued their crypto market dominance, accounting for nearly 90% of all crypto transactions.