Regulation
Binance to limit unregulated stablecoins in EU ahead of new crypto rules
Binance will limit the availability of “unregulated” stable coins» in the EU by June 30, in line with the next Markets in Crypto-Asset Regulation (MiCA)according to a press release published on June 3.
The crypto exchange indicated that several stablecoins may not comply with the new regulations and will be subject to restrictions. However, he did not specify which stablecoins would be affected.
Binance said:
“This will be a first step towards entering the new regulatory framework and will have a significant impact on the stablecoin market in the EEA.”
Step-by-step approach
Binance plans to implement a phased approach to meet new stable regulations in Europe.
The exchange will allow users to convert their unregulated stablecoin holdings into other digital assets such as Bitcoin, Ethereum, regulated stablecoins and fiat currencies. He added:
“These transitional measures aim to enable EEA users to transition to regulated Stablecoins while avoiding any market disruption and complying with MiCA’s Stablecoin Rules. “
Additionally, Binance will implement restrictions across its entire product line, preventing users from accessing new products or services involving unauthorized stablecoins.
As of press time, Binance did not respond to CryptoSlate’s request for additional comment.
Imminent MiCA regulations
The European Union’s MiCA legislation is expected to be fully operational by the end of 2024, and stablecoin regulations will be enacted this month.
Under these new rules, only electronic money institutions (EMIs) and credit institutions can issue stablecoins, in line with the existing European Electronic Money Directive (EMD). Top Crypto Exchanges Like Kraken and OKX endeavor to comply with these regulations, which may include removal of USDT stablecoin from Tether from their platforms.
On the other hand, Circle and his USDC Stablecoins are well positioned to meet these requirements. Circle applied for an EMI license in December 2023 after obtaining conditional registration in France. The move is part of Circle’s strategy to align with the EU’s MiCA regime.
Dante Disparte, Circle’s chief strategy officer, highlighted the importance of MiCA, declaring:
“MiCA is not crypto’s Y2K moment that can be ignored. There are truly significant developments underway for digital assets in the world’s third-largest economy.”