Regulation
Kraken considers delisting Tether under new European regulations
Due to new regulations, leaders Kraken cryptocurrency exchange is “actively reviewing” whether to remove Bind (USDT) from its European market. Markets in Crypto Assets (MiCA) regulations will be implemented across Europe, potentially creating compliance challenges for stablecoins like Tether.
Marcus Hughes, global head of regulatory strategy at Kraken, revealed that the exchange is preparing for multiple scenarios, eliminating USDT as an option. However, the final decision will only be made when the regulatory situation is clearer.
MiCA regulations and impact on the market
European banking authorities approved the MiCA regulations in April 2023, imposing stringent requirements on stablecoins issued within the EU. The primary purpose of these rules is to ensure financial stability and consumer protection, but they also pose significant compliance challenges for stablecoin issuers. The phased rollout of MiCA will see some rules applied by mid-2024, with full implementation by December 2024. OKX has already canceled Tether trading pairs in Europe, and Kraken may follow suit.
Kraken’s commitment to compliance
Kraken is committed to adhering to global regulatory standards and promoting cryptocurrency adoption. A spokesperson reassured that there are no immediate plans to delist Tether or alter USDT trading pairs. The company continually evaluates its operations to ensure compliance and operational efficiency, highlighting Kraken’s commitment to aligning with regulations and maintaining a safe business environment.
Tether discussions with regulators
Tether, the USDT issuer, is currently in serious discussions with European regulators over the proposed MiCA rules. Paolo Ardoino, CEO of Tether, expressed concern about the risks associated with the new regulatory framework, particularly the mandate for stablecoins to hold reserves in uninsured cash deposits. He argued that 100% of their reserves should be held in Treasury bills to avoid exposure to bank failures, citing the collapse of Silicon Valley Bank as a cautionary example. Tether remains confident in continuing discussions with EU regulators on these critical issues.
Kraken’s future plans
Kraken aims to navigate evolving crypto regulations by reviewing its support for Tether and remaining engaged in regulatory developments. The exchange is committed to maintaining its commitment to innovation and compliance while navigating the evolving regulatory landscape.
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