While the regulatory future of stablecoin Tether’s USDT is unclear, the European Union’s Markets in Crypto-Assets Regulation (MiCA) may result in compliance hassles for Tether. However, ESMA has not yet confirmed whether USDT is “noncompliant” but said it is trying to do so in the MiCA framework.
Coinbase has let customers of the cryptocurrency know that it’s going to delist ‘noncompliant stablecoins’ by the end of 2024. But that will have an impact on USDT, while communities debate Tether’s future in Europe. USDC was approved in July, and will continue to be offered by Coinbase as MiCA compliant stablecoins.
Tether Develops Tech Solution
Tether raised concerns about MiCA’s reserve management requirements, and its CEO Paolo Ardoino acknowledged the EU regulators’ work but worried that some aspects of the law could make stablecoin operations more complicated, exposing local banking systems to risks. While, according to reports, USDT is developing a tech-based solution for the European market, no time frame for its roll out has been provided.
Many insisted that USDT and other companies attached to it resist compliance, as the business model of such cryptocurrency companies will be disrupted. If USDT would be willing to comply it will have to make major alterations to its reserve management strategy.
USDT (Tether) is valued near $120 billion and recently hit its 10 year anniversary with more than 350 million users across the globe. Ardoino, CEO, hinted that the company could step from Europe to emerging markets such as Argentina.
