The European Union’s Markets in Crypto-Assets Regulation (MiCA) is set to come into effect on June 30, and several major cryptocurrency exchanges are already taking steps to comply with the new regulations. One of the main changes that exchanges are making is dropping support for stablecoins within the European Economic Area (EEA). Binance, the largest crypto exchange by trading volume, has stated that the new regulations will have a significant impact on the stablecoin market in the EEA.
At least four cryptocurrency exchanges have confirmed that they are restricting access to certain stablecoins for users within the EEA. Bitstamp, for example, announced that it would delist the euro-denominated stablecoin EURT before the deadline. Binance has also made changes ahead of MiCA, such as blocking certain services and restricting the purchase of unauthorized stablecoins.
MiCA aims to regulate cryptocurrency services in the EU under one umbrella, similar to MiFID. The regulation will affect the distribution of cryptocurrencies in the bloc, impacting both retail and institutional players. The first phase of MiCA, focusing on stablecoins, will come into effect on June 30, with broader compliance for exchanges and wallets set to follow on December 30. Under MiCA, stablecoin issuers must maintain a 1:1 reserve for fiat-backed stablecoins, with restrictions on daily transaction limits for non-euro pegged stablecoins.
Several cryptocurrency exchanges have already started taking measures to comply with MiCA. OKX confirmed the delisting of USDT pairs in the EEA earlier this year, while Kraken considered removing USDT pairs before clarifying that they will continue to list USDT in Europe. Despite the preparations, a recent report revealed that only 9 percent of cryptocurrency firms surveyed are fully compliant with MiCA requirements, with 25 percent yet to start preparations.
Overall, the introduction of MiCA regulations will bring significant changes to the cryptocurrency market in the EU. By dropping support for certain stablecoins and ensuring compliance with the new rules, cryptocurrency exchanges are preparing for a more regulated environment. As the deadline approaches, exchanges will continue to make necessary adjustments to ensure they are in line with MiCA requirements and can continue to operate within the European Economic Area.
