Crypto Platforms Adjust Stablecoin Offerings Ahead of EU's MiCA Rollout Amid Major Industry Moves
Summary:
Major crypto platforms are revising their stablecoin offerings in light of the upcoming European Union’s Markets in Crypto-Assets Regulation (MiCA). Bitstamp and Uphold are delisting several stablecoins, while Binance is categorizing them based on regulatory compliance. The new rules have raised concerns within the industry but also have been viewed as enhancing investor protection. Meanwhile, Jump Crypto's CEO has resigned amidst an investigation, Animoca Brands is planning a return to the stock market, Riot is attempting a board overhaul at Bitfarms, and Nubank is bringing Bitcoin Lightning to its Latin American customers.
In adherence to the forthcoming directives outlined in the European Union’s Markets in Crypto-Assets Regulation (MiCA), several trade platforms are reviewing their stablecoin offerings. Bitstamp, one of the forerunners in listing stablecoins, recently declared the suspension of Tether’s EURT in response to the new rules, while Uphold has issued similar notifications for Tether (USDT), Dai (DAI), Frax Protocol (FRAX), Gemini dollar (GUSD), Pax dollar (USDP), and TrueUSD (TUSD). Additionally, Binance is revising its approach to stablecoins, dividing them into "regulated" and “non-compliant” based on their adherence to the regulations. Any categorized as "non-compliant" will only be available on its platform for selling. The MiCA directive is set to come into effect in two waves, starting at the end of June in 2024 and fully implemented by the end of the same year. The regulation identifies three types of cryptocurrency – namely, electronic money tokens, asset-referred tokens, and others such as utility tokens. There is concern that the considerable market capitalization of stablecoins, currently over $163 billion, could impact monetary sovereignty and economic stability. However, PwC Luxembourg’s Deputy Managing Director, Olivier Carré, argues that the regulation will enhance investor protection and contribute to stability and integrity across the EU’s financial market. Nonetheless, some industry players, like Tether’s CEO Paolo Ardoino, have critiqued the regulation, citing the stringent reserve requirements of 60% for stablecoins as problematic. This week’s cryptocurrency news also features reports of Jump Crypto CEO, Kanav Kariya’s resignation amidst an ongoing investigation as well as animoca Brands’ plans for a re-entry into the stock market. Jump Crypto, a digital asset wing of Jump Trading, was implicated in the 2022 Wormhole bridge hack, the collapse of the Terra ecosystem, and had significant exposure to FTX. Elsewhere, Riot is gearing up to replace three board members of Bitfarms after claiming a 14.9% stake in the company, and Nubank is set to introduce its 100 million customers in Latin America to the Bitcoin Lightning Network in partnership with Lightspark.
Published At
6/29/2024 12:00:00 AM
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