Coinbase Global Inc. recently revealed plans to delist all non-compliant stablecoins from its European platform by the end of December 2024.
This decision is in direct response to the implementation of the European Union’s upcoming Market in Cryptoassets (MiCA) regulation, which aims to establish a standardized regulatory framework for cryptoassets across the EU.
The MiCA regulation, which is scheduled to come into full force on December 31, 2024, will require stablecoin issuers to secure e-money authorization within the EU, strengthen oversight within the European Economic Area (EEA), and provide consumer protection. It is mandatory to ensure protection.
Coinbase’s delisting will target stablecoins that do not comply with the new MiCA rules. The exchange promised to notify users about the transition in November and offer them the option to change their holdings to a compliant stablecoin like Circle’s USDC. This proactive compliance approach positions Coinbase as a leader in meeting regulatory requirements in the crypto market.
The regulatory landscape is expected to have a significant impact on the European stablecoin market. Large companies such as Tether Holdings, which issues the USDT stablecoin, may face difficulties as they are unable to obtain the necessary approvals to operate under the EU’s new framework.
This legal pressure could lead other crypto exchanges to follow MiCA’s norms, changing the stablecoin landscape.
Several other platforms, such as OKX, Bitstamp, and Uphold, have already taken steps to restrict the use of non-compliant stablecoins, illustrating the growing trend of regulatory harmonization in the crypto industry.
Despite these stringent requirements, MiCA-compliant stablecoins like USDC continue to grow in popularity. Circle’s recent partnership with MHC Digital to expand USDC into Australia and the Asia-Pacific region exemplifies this trend.
In a related memo, Coinbase Chief Legal Officer Paul Grewal expressed concern about the U.S. Securities and Exchange Commission’s (SEC) inconsistent handling of legal arguments in numerous crypto cases. He criticized the SEC’s mixed messages on whether digital asset transactions are considered securities, highlighting that this is creating confusion and uncertainty in the industry.
Also read: Coinbase CLO challenges SEC’s ‘crypto-asset security’ terminology
