Kraken is currently evaluating its support for Tether (USDT), the world’s most-traded cryptocurrency, in response to forthcoming EU digital asset regulations. The regulations, part of the<a href="https://thecoinrise.com/mica-framework-signed-into-law-by-eu-officials/" rel="noopener noreferrer nofollow"> Markets in Crypto-Assets (MiCA) framework</a>, are set to take effect in July and could impact stablecoins like the USDT.&nbsp;
<h2 id="b-implications-of-mica-regulations-on-stablecoins-b">Implications of MiCA Regulations on Stablecoins</h2>
According to a<a href="https://www.bnnbloomberg.ca/kraken-actively-reviewing-tether-s-status-under-new-eu-rules-1.2074477" rel="noopener noreferrer nofollow"> Bloomberg report</a>, the MiCA’s new guidelines are still awaiting finalization by the European Banking Authority (EBA). When finalized, it will impose stringent restrictions on stablecoins offered to investors within the EU.
These stablecoins are crucial for traders, facilitating the transfer of digital assets between exchanges and providing a stable store of value amid market volatility.
Marcus Hughes, Kraken’s global head of regulatory strategy, hinted that Kraken is preparing for all possible outcomes, including the potential delisting of USDT. “As the position becomes clearer, we can take firm decisions on that,” Hughes remarked.
<h2 id="b-tether-s-response-and-strategic-adjustments-b">Tether’s Response and Strategic Adjustments</h2>
Meanwhile,<a href="https://thecoinrise.com/tether-slams-deutsche-bank-over-usdt-collapse-prediction/" rel="noopener noreferrer nofollow"> Tether</a>, in reacting to Kraken’s considerations, emphasized the importance of maintaining EUR liquidity for European customers. It states that it is necessary to achieve this using USDT as a conversion tool.
Paolo Ardoino, Tether’s CEO, has previously expressed concerns about some of MiCA’s requirements and stated that Tether will continue its talks with regulators. However, Tether in an earlier stance said it has no immediate plans to comply with MiCA regulations.
Earlier this year, OKX, another major crypto exchange, had<a href="https://thecoinrise.com/okx-discontinues-the-support-for-usdt-trading-pairs-in-europe/" rel="noopener noreferrer nofollow"> adjusted its USDT trading options</a> in the EU. The exchange removed the ability to buy or sell other crypto assets using USDT. However, European users can still deposit, withdraw, and conduct over-the-counter transactions with USDT, as well as convert it to euros.
<h2 id="b-kraken-exchange-s-strategic-plan-for-compliance-b">Kraken Exchange’s Strategic Plan for Compliance</h2>
In the meantime, European regulators are finalizing MiCA’s technical guidance as it is expected to be fully implemented by early 2025. The EBA will oversee these rules, requiring issuers of asset-referenced and e-money tokens to obtain licenses from national financial authorities by June 30.
Hughes however noted that the variety of stablecoins currently available in Europe might not be sustainable under MiCA. “At some point in the future, there’ll be a cut off at which that won’t be possible,” he said, depending on which assets get registered under the new e-money regime.
Currently, amid these impending regulations, Kraken is in the advanced stages of selecting its European headquarters post-MiCA, with France and Ireland being top contenders even<a href="https://thecoinrise.com/kraken-unleashes-institutional-service-to-outcompete-coinbase/" rel="noopener noreferrer nofollow"> among its competitors</a>. As per Kraken’s website, it is already registered with regulators in several EU countries, including Italy, Spain, Ireland, Belgium, and the Netherlands.
The post <a href="https://thecoinrise.com/kraken-scrutinizes-tether-amid-new-eu-regulations/" rel="noopener noreferrer nofollow">Kraken Scrutinizes Tether Amid New EU Regulations</a> appeared first on <a href="https://thecoinrise.com" rel="noopener noreferrer nofollow">Latest News and Insights on Blockchain, Cryptocurrency, and Investing</a>.

Kraken Scrutinizes Tether Amid New EU Regulations

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