As per the Bloomberg report, Kraken is “actively reviewing” its plans to potentially remove support for the world’s most-traded cryptocurrency, Tether (USDT), from its European Union exchange, due to new digital asset regulations set to take effect in July.
Tether Holdings Ltd.’s USDT, a stablecoin designed to maintain a one-to-one value with the dollar, is expected to be impacted by the upcoming EU rules known as MiCA. The guidance, still being finalized by the European Banking Authority, will impose restrictions on stablecoins available to investors in the bloc.
Marcus Hughes, Kraken’s global head of regulatory strategy, said in an interview on Thursday, “We’re absolutely planning for all eventualities, including situations where it’s just not tenable to list specific tokens such as USDT. It’s something that we’re actively reviewing, and as the position becomes clearer, we can take firm decisions on that.”
Stablecoins are primarily used by traders to transfer digital assets between exchanges or to store wealth away from volatile token prices.
As per Bloomberg, Tether said in response that it expects exchanges to “rightfully focus on EUR liquidity for European customers, while maintaining USDT as an on-ramp off-ramp solution.”
Tether also referenced a statement from its CEO, Paolo Ardoino, who expressed concerns about certain MiCA requirements and confirmed the company’s ongoing dialogue with regulators.
European regulators are finalizing technical guidance for MiCA, which is expected to be fully implemented by early 2025. The EBA will oversee the bloc’s stablecoin rules, requiring issuers of asset-referenced and e-money tokens to hold a national financial authority license by June 30.
Issuers must also meet higher standards for corporate governance, conflict of interest, and reserve management, such as holding at least a third of all funds at an independent credit institution.
A Kraken representative contacted the Crypto Times and clarified that there are no current plans to delist Tether or alter any USDT trading pairs. He further said, “As a leading crypto exchange, we are constantly evaluating our global strategy and operations to ensure that we remain compliant both now and in the future.”
Kraken is in the “advanced stages” of selecting its post-MiCA European headquarters, with France and Ireland popular among rivals like Coinbase, Binance, and Gemini. Kraken is currently registered with regulators in Italy, Spain, Ireland, Belgium, and the Netherlands, according to its website.
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