Tether commends EU regulators for their efforts to establish a structured framework for stablecoins through MiCA.
Key Takeaways
- Tether is developing a technology solution tailored for the European market.
- The new tech aims to address challenges posed by the MiCA regulatory framework.
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Tether is set to introduce a new technology solution specifically designed for the European market in a bid to adapt to the evolving regulatory landscape in the region. The plan was revealed amid rumors of USDT’s potential delisting from Coinbase in Europe.
“As we have consistently expressed, some aspects of MiCA make the operation of EU-licensed stablecoins more complex and potentially introduce new risks to both local banking infrastructure and stablecoins themselves,” Tether said in a statement on Friday.
“Tether is developing a technology-based solution, which we will unveil in due course and will be tailor-made to serve the necessities of the European market. We’re very excited about our upcoming product strategy,” the company added.
Coinbase has set December 30, 2024 as the deadline for stablecoin compliance in the EU. After the designated date, the exchange will delist non-compliant stablecoins in the European Economic Area (EEA). The change will not affect other regions.
The decision is part of Coinbase’s ongoing effort to comply with MiCA regulations. Before Coinbase, a number of crypto exchanges such as OKX, Bitstamp and Uphold, ended services for non-compliant stablecoins in the EU ahead of MiCA’s full implementation.
Tether CEO Paolo Ardoino previously explained that the company still discussed with the regulators about concerns regarding the stringent cash reserve mandates set forth by the MiCA regulations.
Ardoino warned that the strict requirements could pose systemic risks to both banks and digital assets, making them vulnerable to mass withdrawal, similar to the case of Silicon Valley Bank.
While Tether said certain aspects of MiCA may pose challenges for EU-licensed stablecoins, the firm praised EU regulators for creating a structured regulatory environment, which is crucial for the sector’s growth.
“In Europe, the use cases for stablecoins are very different from the ones in emerging markets and developing countries where USDT is extremely popular,” Tether stated. “The economy in Europe is stable and very structured. Moreover the regulatory landscape is evolving with the introduction of MiCA. Tether commends EU regulators for their efforts in establishing a structured framework, as it plays a key role in fostering growth within the sector.”
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