Key takeaways
- The rollout of MiCA on December 30 raises uncertainties about Tether’s compliance and its impact on the crypto market.
- Coinbase delisted USDT due to MiCA regulations, while other exchanges await further guidance.
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Tether’s USDT stablecoin faces growing regulatory uncertainty as the European Union’s Markets in Crypto-Asset (MiCA) regulation comes into force on December 30.
The new framework imposes strict compliance requirements for stablecoins, raising questions about the operational status of USDT in the EU.
Amid this uncertainty, many people on crypto Twitter have been spreading FUD (fear, uncertainty, and doubt) about Tether, speculating about its compliance and future stability under the new rules.
Coinbase has already delisted USDT in anticipation of MiCA regulations, while major exchanges including Binance and Crypto.com continue to trade the stablecoin pending regulatory guidance.
“No regulator has explicitly stated that USDT is non-compliant, but that doesn’t mean it is,” MiCA Crypto Alliance technical committee member Juan Ignacio Ibañez told Cointelegraph.
He added that the key question remains whether all exchanges will delist USDT simultaneously or whether some will wait for more clarity from regulators.
Tether CEO Paolo Ardoino addressed market concerns on social media, suggesting that the FUD around Tether is often bullish for the crypto market, while dismissing the campaign as a “poorly coordinated effort” by the share of competitors.
Under MiCA, stablecoin issuers must obtain an e-money license and keep up to two-thirds of reserves in independent banks. Although Circle has obtained the required license, Tether has not yet done so.
In a Bloomberg report, Pascal St-Jean, CEO of crypto asset manager 3iQ Corp., highlighted the importance of Tether, stating that “a large portion of crypto assets trade in pairs against Tether’s USDT “.
He added that moving to other stablecoins or fiat pairs could create inefficiencies for investors.
The new MiCA regulations could result in the delisting of the stablecoin on several European crypto exchanges, which could lead traders to abandon USDT by exchanging it for USDC or EUR fiat.
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