New Regulations Push Exchanges to Drop Stablecoins

by Giorgi Kostiuk

a year ago

Some crypto exchanges have announced plans to remove stablecoins from their offerings. This decision is driven by changes in regulations that exchanges are now facing.

What are Stablecoins?

Stablecoins are digital assets that function similar to cryptocurrencies but are not tied to market forces. Their value is usually tied to fiat money, most commonly the US dollar.

Removing Stablecoins

Decentralized exchanges like Coinbase have announced plans to delist stablecoins for EEA users, citing compliance with EU MiCA legislation.

"Given our commitment to compliance, we intend to restrict the provision of services to EEA users in connection with stablecoins that do not meet the MiCA requirements by December 30, 2024,"Coinbase

EU Regulations

The EU has introduced the comprehensive MiCA crypto regulation, limiting stablecoin trades unless certain demands are met. As a consequence, exchanges like Coinbase choose to exit rather than comply.

Tether commends EU regulators for their efforts in establishing a structured framework, but expresses concern over some MiCA aspects complicating EU-licensed stablecoins operations.Tether

In conclusion, the decision by crypto exchanges to remove stablecoins is largely driven by new regulations, like the EU's MiCA. Though initially affecting a few platforms, this change could impact all exchanges over time.

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