Kraken could drop EU support for Tether’s USDT stablecoin, Bloomberg reported on May 17.
Kraken Global Head of Regulatory Strategy Marcus Hughes said the company is planning for circumstances where it is “not sustainable to include specific tokens such as USDT.”
The EU’s regulatory landscape will change when the EU Guidelines for Markets in Crypto Assets (MiCA) come into effect in July. MiCA will require companies issuing fiat-backed stablecoins such as Tether to register as electronic money institutions (EMIs) and meet other requirements.
Hughes said new regulations will reduce the number and varieties of stablecoins available in Europe, depending on which companies comply with the EU regime.
Other statements do not describe the delisting. In a separate report from The Block, a spokesperson for Kraken said the company is continually reviewing its global strategy and operations for compliance, but “currently has no plans to delist or change Tether.” [its] USDT Trading Pairs.”
Concerns about EU regulations
Tether told Bloomberg that it expects the exchanges to keep the USDT as an on- and off-ramp while providing EUR liquidity for European customers.
Tether also referenced the concerns of its CTO, Paolo Ardoino, in its statement. Ardoino criticized the MiCA’s “strong restrictions” around reserve management and said the company has no plans “at this time” to seek regulatory approval in the EU.
Other crypto exchanges have made similar moves in recent months in anticipation of MiCA. OKX canceled Tether for EU users in March, but made no direct reference to the upcoming regulations. The company said it would continue to support Circle’s competing USDC stablecoin.
Elsewhere, Binance France chief legal officer Marina Parthuisot said in September 2023 that the company could delist “all stablecoins in Europe by June 30.”
Binance’s then-CEO Changpeng Zhao later said this was taken out of context and that the company had worked with stablecoin issuers who were compliant.