The European Securities and Markets Authority (ESMA) has called for firms to restrict the use of stablecoins that do not comply with the EU's new Markets in Crypto-Assets Regulation (MiCA).
EU Regulators Set 2025 Deadline for Compliance
On January 17, ESMA released a statement emphasizing the need for crypto asset service providers to take immediate action regarding non-compliant stablecoins, also known as asset-referenced tokens (ARTs). National competent authorities (NCAs) play a key role in guiding firms towards MiCA compliance.
Restrictions on Non-Compliant Stablecoins
Crypto asset service providers have until the end of January 2025 to implement restrictions, with 'sell-only' allowances extending until the end of Q1 2025. This provision aims to enable EU investors to liquidate or convert holdings in non-compliant stablecoins during this transition period.
Tether's USDT May Face Delisting
ESMA's directive suggests that Tether's USDT, the largest stablecoin by market cap, does not meet MiCA requirements. 'Tether does not have a license,' stated Juan Ignacio Ibañez from the MiCA Crypto Alliance. Ibañez indicated that firms might need to delist USDT by January 31, with complete removal, including 'sell-only' options, by March 31.
ESMA is pushing for strict adherence to MiCA regulations for stablecoins, setting a deadline by early 2025 and emphasizing the need for compliance enforcement by EU regulators.
