Kraken ‘Actively Reviewing’ USDT Suspension in EU Amid MiCA Regulation

Kraken considers delisting USDT stablecoin in the European Union

Cryptocurrency exchange Kraken is evaluating the potential suspension of the USDT stablecoin for its European users, according to a Bloomberg report. This consideration arises as the European Union prepares to implement a new regulatory framework for digital assets in July.

The impending Markets in Crypto Assets (MiCA) regulations, which have not yet been finalized by the European Banking Authority, are expected to impose stringent restrictions on stablecoins available to European investors. Kraken’s global head of regulatory strategy, Marcus Hughes, stated, “We’re absolutely planning for all eventualities, including situations where it’s just not tenable to list specific tokens such as USDT.”

Tether’s Response

Tether officials anticipate that exchanges will prioritize euro liquidity for EU clients while maintaining USDT as a provisional measure. Despite this, Tether CEO Paolo Ardoino previously indicated that Tether does not intend to comply with MiCA regulations in the medium term.

Earlier this year, in March, OKX, another major cryptocurrency exchange, suspended USDT trading for European Union users, a move likely influenced by the forthcoming MiCA regulations.

Legal Framework and Compliance

MiCA aims to provide a clear legal framework for crypto exchanges and companies offering cryptocurrency custody services, allowing them to operate legally within the EU. The law will also establish comprehensive rules for the operation of stablecoin issuers. After MiCA comes into effect, crypto companies will be required to obtain registration in one of the EU member states, granting them the ability to operate throughout the entire bloc. The provisions specifically targeting stablecoins are set to become effective as early as June 2024.

source