Coinbase has announced its plan to delist six stablecoins, including Tether (USDT), from its European platforms starting December 13, citing challenges in aligning with the EU’s Markets in Crypto-Assets (MiCA) framework. The exchange will continue to support MiCA-compliant assets like USD Coin (USDC) and EUR Coin (EURC).
Stablecoins Targeted for Delisting
In a notification to users, Coinbase stated, “Due to MiCA regulations, Coinbase is implementing restrictions on stablecoin services that do not meet MiCA requirements.” Alongside USDT, Coinbase will delist Paxos Standard (PAX), PayPal USD (PYUSD), Gemini Dollar (GUSD), GYEN, and Maker Protocol’s DAI from its Coinbase Europe and Coinbase Germany platforms.
While USDC and EURC remain compliant with MiCA regulations, Coinbase advises users to sell, convert, or transfer non-compliant assets off the platform before the restriction date.
MiCA’s Regulatory Deadline Approaches
The first phase of MiCA, launched in June 2024, introduced stricter guidelines for stablecoins, requiring full compliance by December 30. Coinbase is encouraging users to convert restricted assets into approved ones and has indicated it may reconsider delisted tokens if they achieve compliance in the future.
Although MiCA regulators have not explicitly declared USDT non-compliant, Coinbase’s decision reflects its commitment to adhering to European regulatory standards. Tether has criticized the accelerated implementation of MiCA but expressed its dedication to developing compliant solutions for the region.
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Broader Market Impacts
MiCA’s implementation marks a pivotal moment for Europe’s crypto markets. Earlier this year, Circle, the issuer of USDC, secured a MiCA-compliant license, making it an attractive option for exchanges seeking stablecoins aligned with EU standards. Binance also recently partnered with Circle to promote USDC adoption, further underscoring the shift towards compliant assets.
In September, a report by Consumers’ Research raised concerns about Tether’s transparency regarding dollar reserves, labeling USDT as potentially risky for consumers. Despite these criticisms, Tether has defended its practices but has yet to undergo a full audit by a reputable firm.
The Role of Stablecoins
Stablecoins like USDT are pegged to fiat currencies at a 1:1 ratio, offering stability in the volatile crypto market. They serve as a digital representation of traditional money, enabling seamless transactions and value storage for users. However, regulatory compliance remains a critical factor for their continued adoption and support.
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