The exchange Kraken has announced the decision to delist five stablecoins, including Tether, from operations in the European Economic Area. This decision is driven by new regulations under the Markets in Crypto-Assets (MiCA) framework.
Context and Reasons for Delisting
Kraken will delist stablecoins such as Tether (USDT), PayPal USD (PYUSD), Euro Tether (EURT), TrueUSD (TUSD), and TerraUSD (USDT). This measure is associated with the implementation of new MiCA regulations, requiring stricter compliance standards for stablecoins in the EU.
Phases and Timeline of Delisting
The delisting process will begin on February 13, 2025. On this date, margin pairs for these assets will switch to 'reduce-only' status for EEA clients. By February 27, spot trading will be restricted to 'sell-only,' and no new deposit addresses will be created for these assets. Automatic closure of all open margin positions will occur on March 17, and spot trading will stop on March 24. By March 31, 2025, the remaining holdings will be automatically converted to a compliant stablecoin.
Market Reaction and Other Measures
Kraken operates in several European countries, including Germany, Spain, and France. The increased scrutiny on stablecoins by European regulators is putting pressure on cryptocurrency exchanges in the region. Following Kraken's announcement, Crypto.com also stated it plans to delist USDT and nine other tokens in Europe by January 31, 2025.
Kraken's actions highlight the importance of adapting cryptocurrency businesses to new regulations, reflecting their cooperation with regulatory bodies and strategies in the market.
