David Edwards
Leading cryptocurrency exchange Kraken has declared its intention to delist five stablecoins, including Tether’s USDT, in order to adhere to the Markets in Crypto-Assets Regulation (MiCA) of the European Union.
Timeline for Gradual Delisting
According to an official statement, Kraken will fully delist USDT by March 31, 2025, alongside PayPal USD (PYUSD), Tether EURt (EURT), TrueUSD (TUSD), and TerraClassicUSD (UST) for European users.
To guarantee adherence to MiCA and prevent market interruptions, the exchange has laid out a staged strategy:
- First, Kraken will set margin pairs involving the affected assets to “reduce-only” mode for clients in the European Economic Area (EEA) on Feb. 13. Following this restriction, EEA users will be only able to reduce or fully close out existing margin positions.
- By Feb. 27, Kraken will put the affected tokens in “sell-only” mode, restricting EEA clients from generating deposit addresses for tokens like USDT but still supporting trading.
- On March 24, Kraken will halt all spot trading for the affected assets, closing all open orders and exchanges into other coins or fiat currencies.
The Effect of MiCA on Crypto Exchanges
Kraken’s action is part of a larger pattern of bitcoin platforms adjusting to MiCA rules. A similar delisting procedure that will impact USDT and nine other stablecoins beginning on January 31, 2025, was recently disclosed by Crypto.com.
To avoid market instability, exchanges have been encouraged by the European Securities and Markets Authority (ESMA) to phase out non-compliant assets gradually. The regulatory body supports Kraken’s methodical approach by recommending a sell-only period prior to outright delisting.
Industry Reactions and Regulatory Pressures
MiCA seeks to create a single, EU-wide regulatory framework for digital assets. But its implementation has drawn criticism, especially from Tether, which has denounced the “hurried” process of removing USDT.
Among the first significant exchanges to adopt MiCA-driven compliance measures were Kraken and Coinbase, which delisted USDT and eight other tokens in December 2024.
