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EU crypto regulation MiCA takes effect! OKX delists USDT trading pairs in Europe, will Circle be the first mover?

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EU crypto regulation MiCA takes effect! OKX delists USDT trading pairs in Europe, will Circle be the first mover?

According to the email sent to users by OKX, all trading pairs related to USDT have been delisted recently. Currently, USDT can only be used for spot trading pairs supporting EUR and USDC. It is widely believed that this move is related to the upcoming EU crypto regulation MiCA.

OKX Removes European Region USDT Trading Pairs

User MartyParty revealed in a tweet yesterday that cryptocurrency exchange OKX has ceased support for the European Union and the European Economic Area (EEA) for the majority of trading pairs involving Tether's USDT stablecoin.

As shown in the image, OKX stated in a letter sent to local users:

Please note that due to regulatory requirements, USDT trading pairs in your current region are no longer available for trading. In the future, the only available USDT currency trading pairs on the spot market will be USDT/EUR and USDT/USDC.

They also added, "USDT can still be deposited and withdrawn, and can be bought or sold in over-the-counter (OTC) trading."

In the letter, OKX also mentioned that this move will only affect a small number of users, and they will focus on expanding the liquidity of the Euro-to-cryptocurrency market:

At the same time, we will also launch over 30 new Euro spot trading pairs.

As of now, OKX and Tether have not yet responded to this.

EU Cryptocurrency Regulation MiCA Soon to Take Effect

It is speculated that the regulatory reasons behind OKX's actions may be related to the stablecoin regulations in the Markets in Crypto-Assets Regulation (MiCA) framework. The regulation states that only Electronic Money Institutions (EMIs) and credit institutions can issue stablecoins.

It is reported that this law will come into effect before the end of this year, and the stablecoin regulatory rules are expected to be implemented before June.

EU Cryptocurrency Regulation MiCA to Take Effect Soon, Binance Warns of Potential Large-scale Delisting of Stablecoins

As such, Tether, as the issuer of stablecoins with a market value exceeding 100 billion USD, has been under scrutiny for its reserve transparency and regulatory compliance.

On the other hand, the United States is also about to introduce specific stablecoin regulations to provide consistent regulatory standards such as KYC and anti-money laundering for many stablecoin issuers including Tether and Circle.

Circle Leading Over Tether?

In December last year, Circle, the issuer of the second-largest stablecoin in market size after USDT, received conditional registration from the French Financial Markets Authority (AMF) for its Digital Asset Service Provider (DASP), and subsequently applied for an EMI license.

Circle Receives Conditional Registration from French Digital Asset Service Provider DASP, Strengthening Compliance Development in Europe

In terms of regulatory aspects in the European stablecoin market, Circle's issuance of the Euro stablecoin EURC is indeed in a leading position.

However, the Euro stablecoin market is still in its early stages, and other competitors besides Tether's EURT include stablecoins such as EURCV EUR CoinVertible launched by the French banking giant Societe Generale.