Uphold Axes Multiple Stablecoins as MiCA Rattles Exchanges

• Crypto exchange Uphold has announced plans to delist several stablecoins.
• The exchange’s decision comes ahead of the incoming MiCA regulations.
• Other crypto exchanges have outlined similar reforms of their stablecoin offerings.

Regulations in the crypto industry are constantly evolving, as evidenced by the new MiCA (Markets in Crypto Assets) legislation . Targeted at addressing the mounting concerns of the use of digital assets in illicit financial activities, the MiCA rules have established stricter compliance standards for service providers, including reforms on stablecoin offerings within the region.

In response to the changing standards, crypto exchange Uphold is adjusting its service offerings.

Uphold Shuffles EU Stablecoin Option

In an email shared by one of the exchange’s users on Monday, June 17, 2024, Uphold announced its decision to halt support for six stablecoins in alignment with the evolving MiCA regulatory standards.

The exchange stated that effective July 1, 2024, it will no longer support the impacted stablecoins, including Tether (USDT) , the largest stablecoin by market capitalization, TrueUSD (TUSD), Dai (DAI), Frax (FRAX), Gemini Dollar (GUSD), and Pax Dollar (USDP).

The reform mandates that Uphold users convert their balances in the impacted assets into one of three still-supported stablecoins, USDC , EURC, or PYLUSD. The final deadline for conversion is June 27, 2024, at 23:59 CET (22:59 UTC). Uphold added that any remaining balances in these stablecoins will be automatically converted to USDC by June 28, 2024.

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Uphold’s stablecoin review is not isolated. It is the latest move in the ongoing scramble among exchanges to adhere to the new regulatory standards.

Crypto Firms and MiCA Stablecoin Reform

Since the introduction of the new regulatory standards, several exchanges have begun efforts to ensure compliance. On June 3, 2024, Binance announced reforms to its stablecoin offerings in the European Union, which include limiting support for “unregulated” stablecoins.

Binance CEO Richard Teng emphasized that the move aims to comply with the new MiCA rules, stating that the exchange will restrict the availability of affected assets for EEA users on select products.

Crypto exchange Kraken has also highlighted ongoing efforts to prepare for the impact of the upcoming MiCA regulations by planning to delist unauthorized stablecoin assets. While the exchange clarified that it will not immediately delist the affected assets, it emphasized its commitment to complying with the revised regulatory standards upon their implementation.

Additionally, USDC issuer Circle is relocating its operations from the EU to the US, as the evolving MiCA regulations stipulate that only EMIs and credit institutions can legally issue fiat stablecoins within the European Economic Area trading bloc.

On the Flipside

• Uphold’s stablecoin review only applies within the European Union.
• Tether’s CEO Paolo Ardoino has stated that the firm has no immediate plans to comply with the new MiCA regulations.
• Crypto exchange OKC has halted support for Tether’s USDT within the EU.

Why This Matters

The tightening MiCA regulatory standards chart an uncertain course for the future of stablecoins within the region, and the reduction in available offerings by Uphold and other exchanges will significantly limit investor access to a range of options.

To better understand the regulatory reform happening in the EU, read this article:
Is Crypto Doomed in the EU? New MiCA Rules Explained  

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