It has been a rough few days for Tether, the issuer of the USDT stablecoin. Following the implementation of MiCA in the EU, two big exchanges have dropped USDT from their exchange platforms in Europe. Last month in December, Coinbase removed USDT from its platform, while today, Crypto.Com faces the same deadline.
Tether has frowned upon this development. A company spokesperson said, “It is disappointing to see the rushed actions brought on by statements which do little to clarify the basis for such moves.”
According to Tether, changes in regulation triggered by MiCA could cause significant risks to investors in the EU. Tether’s representative said, “These changes affect many tokens in the EU market, not only USDT, and we fear that such actions will lead to further risk being placed on consumers in the EU.”
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BREAKING: EU Regulator Orders Crypto Exchanges to Delist Tether’s USDT by January 31, 2025
MiCA Is Coming for Stablecoins – and Europe Is Pushing Innovation Out.
Last year, I warned you: MiCA would destroy stablecoins in Europe. My post went viral, and everything I said is… pic.twitter.com/6M0KRWgNvD
— Anton Golub | antongolub.eth (@Anton_Golub) January 22, 2025
As per Tether, the changes imposed by MiCA, when it is still in its early stages, could cause the EU market to become disorderly. As per the company, there are differences in stablecoin use cases between US & Europe.
Tether stated that there are some aspects of MiCA that make the operations of EU licensed stablecoins complex and can potentially introduce more risk. Although disappointed, Tether commended regulators in the EU for establishing a regulated structure, which is crucial for encouraging digital asset adoption.
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Debate Regarding Delisting of USDT Grows
Critics of MiCA including Tether CEO Paolo Ardoino put forward the case that delisting USDT could end up reducing liquidity and put both the banking sector and digital assets at risk. People say delisting USDT will fragment the market as users switch to other stablecoin options. This may end up complicating cross border payments and increase inefficiencies.
On the flipside, some believe that steps taken by the regulatory authority are beneficial to both users and crypto platforms. Crypto companies for example, are celebrating the passporting feature that allows them to offer their services across all 27 EU member states as a significant milestone.
Marina Markezic, co-founder and executive director of European Crypto Initiative, praises the innovation, security and crypto forward nature of MiCA. “Despite challenges, MiCA creates a great opportunity for crypto businesses to operate more efficiently across European markets. This single registration approach significantly reduces barriers for blockchain and crypto projects to offer services across the EU,” Markezic explains.
Marina says implementing MiCA is good for the EU and puts forward Switzerland’s technology neutral legal framework as an example. Supporters believe that a framework that encourages innovation without stifling growth is why many companies have launched operations in the country.
However, Andreas Garner, a Web3 partner of the Swiss law firm MME does not agree. He does not see MiCA in its current form emulating Switzerland’s success. He says, “As MiCA Regulation is designed as an EU market access regulation, with a high compliance burden (and costs), we are very skeptical that the framework will allow EU/EEA companies to target the global market in an efficient manner.”
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The post MiCA’s USDT Delisting Disappoints Tether, Says Could Make the Market Disorderly appeared first on 99Bitcoins.
