Coinbase is preparing to delist stablecoins that don’t adhere to European regulations by year’s end.
The move, as reported Friday (Oct. 4) by Bloomberg News, comes as the European Union’s Markets in Crypto-Assets Regulation (MiCA) is introducing tougher oversight of cryptocurrency companies.
“Given our commitment to compliance, we intend to restrict the provision of services to EEA [European Economic Area] users in connection with stablecoins that do not meet the MiCA requirements by December 30, 2024,” Coinbase said.
The company also noted that EEA users will be provided with the option to convert to compliant stablecoins, such as Circle’s own USD Coin.
Under MiCA regulations that went into effect June 30, all stablecoins available in the EEA need to have an e-money license in at least one EU member.
As Bloomberg and other outlets noted, the regulation has a direct impact on stablecoins such as Tether’s USDT, which could be removed from Coinbase’s platform unless it can get the proper authorization.
To that end, Tether told the website Crypto Briefing last week that it was working on a solution especially designed for the European market.
“As we have consistently expressed, some aspects of MiCA make the operation of EU-licensed stablecoins more complex and potentially introduce new risks to both local banking infrastructure and stablecoins themselves,” the company said.
“Tether is developing a technology-based solution, which we will unveil in due course and will be tailor-made to serve the necessities of the European market. We’re very excited about our upcoming product strategy.”
As PYMNTS wrote in July, the advent of MiCA led observers to wonder if the “Wild West” era of the digital asset sector was at an end.
“The digital asset and cryptocurrency industry shows no sign of fading as we near the 21st century’s second quarter,” that report said. “Having stricter disclosure requirements, regular audits of crypto firms and more robust capital reserve requirements will help build trust and transparency across the marketplace — and the EU’s implantation of MiCA’s provision for stablecoins puts the EU at the forefront of crypto regulation.”
In other stablecoin news, PYMNTS last week examined efforts by PayPal and Visa to push into this space, arguing that it marks the maturation of the stablecoin ecosystem.
“These heavyweights are not only expanding the use cases for stablecoins but also working on enhancing their stability and legitimacy, an effort that could mark a shift in how stablecoins are perceived and used in the broader financial world,” that report said.
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