Haider Jamal

May 18, 2024

New MiCA Regulations Could Cause Kraken To Delist USDT

Kraken is contemplating the removal of Tether (USDT) on its European Union (EU) platform to adhere to upcoming Markets in Crypto-Assets (MiCA) regulations, based on a recent Bloomberg report. The EU is instituting MiCA rules for crypto trading, particularly focusing on stablecoins such as USDT and USDC. These regulations will come into effect in July, likely imposing restrictions on how these stablecoins are offered within the EU.

As the European Banking Authority finalizes the technical standards for MiCA, exchanges like Kraken are preparing for a future where the present variety of stablecoins may not be viable in Europe. Earlier this year, OKX, another significant crypto exchange, already restricted USDT functionality in the EU.


Clarity Needed

During an interview on Thursday, Marcus Hughes, the Global Head of Regulatory Strategy for Kraken, mentioned that they are awaiting clearer guidelines on the rules before making a final decision. In light of the MiCA regulations, Tether highlighted the need to concentrate on Euro liquidity for European clients while keeping USDT as a transactional gateway.

Tether CEO Paolo Ardoino has also expressed concerns regarding certain MiCA requirements, indicating that Tether will keep engaging with regulators but does not plan to be regulated under MiCA in the medium term. Moreover, as MiCA regulations aim to create a licensing framework for stablecoin issuers and enforce stricter corporate governance and reserve management standards, Kraken foresees that many stablecoins presently available in the EU will likely be removed in the near future.


Tether Is On Board

The scope of the type and number of stablecoins that are offered today in Europe are unlikely to be able to be offered going forward, Hughes stated, before adding that at some point in the future, a lot will depend on which assets are being properly registered within the European Union under the e-money regime.

As of right now, there are no current plans to delist Tether or alter USDT trading pairs. As a leading crypto exchange, Kraken is constantly evaluating their global strategy and operations to ensure that they remain compliant both now and in the future. Regarding MiCA, Kraken claims to be fully committed to following the rules as they continue their mission of accelerating the adoption of cryptocurrencies on a global scale.


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