Binance to limit unregulated stablecoins in EU ahead of new crypto rules
Binance will limit the availability of unregulated stablecoins in the EU by June 30, aligning with the upcoming Markets in Crypto-Assets Regulation (MiCA), according to a statement released on June 3.
The crypto exchange indicated that several stablecoins might not comply with the new regulations and will face restrictions. However, it did not specify which stablecoins would be affected.
Binance said:
This will be a first step entering the new regulatory framework and it will have a significant impact on the stablecoin market in EEA.
Phased approach
Binance plans to implement a phased approach to meet the new stablecoin regulations in Europe.
The exchange will allow users to convert holdings in unregulated stablecoins to other digital assets such as Bitcoin, Ethereum, regulated stablecoins, and fiat currencies. It added:
These transitional measures aim at allowing EEA users to switch to Regulated Stablecoins while avoiding any market disruption and complying with MiCA stablecoin rules.
Additionally, Binance will implement restrictions across its entire product range, preventing users from accessing new products or services involving unauthorized stablecoins.
As of press time, Binance has not responded to CryptoSlates request for further comments.
Impending MiCA regulations
The European Unions 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, aligning with the existing EU Electronic Money Directive (EMD). Major crypto exchanges like Kraken and OKX are working to comply with these regulations, which may include removing Tethers USDT stablecoin from their platforms.
In contrast, Circle and its USDC stablecoin are well-positioned to meet these requirements. Circle applied for an EMI license in December 2023 after securing conditional registration in France. This move is part of Circles strategy to align with the EUs MiCA regime.
Dante Disparte, Circles Chief Strategy Officer, emphasized the significance of MiCA, stating:
MiCA is not cryptos Y2K moment that can be ignored. Really consequential developments are underway for digital assets in the worlds third-largest economy.
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Text source: CryptoSlate
