by Jude Ayua

Binance has announced it would delist nine stablecoins on its exchange in the European Economic Area (EEA) on 31 March 2025 to comply with the Markets in Crypto Asset (MiCA) regulation. After delisting, users in the EEA can no longer trade spot pairs with the affected stablecoins. However, Binance will still allow their custody and conversions. Also, it will continue to support deposits and withdrawals of the affected stablecoins.

MiCA-compliant stablecoins, such as USD Coin (USDC) and Eurite (EURI), will remain available and unchanged. Binance advised EEA users to convert their non-MiCA-compliant stablecoins into compliant stablecoins like USDC and EURI, or fiat currencies such as the Euro.

Read also: MiCA: Crypto.com delists USDT and other stablecoins as Tether kicks.

Affected stablecoins

The affected stablecoins are Tether (USDt), Dai, First Digital USD (FDUSD), TrueUSD (TUSD), Pax Dollar (USDP), Anchored Euro (AEUR), TerraUSD (UST), TerraClassicUSD (USTC), and PAX Gold (PAXG). While Binance will continue to allow deposits and withdrawals for these stablecoins after March 31, it remains debatable if this approach is MiCA-compliant. This uncertainty seems to stem from the European Securities and Markets Authority (ESMA).

In a January 2025 guidance on MiCA, ESMA urged European crypto asset service providers to fully delist non-compliant tokens by 31 March 2025. Juan Ignacio Ibañez, a member of the Technical Committee of the MiCA Crypto Alliance, emphasized that “no trace of USDT should remain” by the deadline.

However, a report by Cointelegraph quotes a spokesperson of ESMA: “Under MiCA, custody and transfer services do not in themselves constitute an ‘offering to the public’ or ‘seeking admission to trading’ of non-compliant asset-reference tokens or e-money tokens.”

While the statement above may be contradictory to the January guidance, it also explains the scope of “delisting,” which means only custody and transfers are allowed. This means Binance allowance of deposits and withdrawals after 31 March may still be MiCA-compliant.

Read also: MiCA: A Rundown of CASPs approvals–January 2025 edition.

Implications for non-Compliant stablecoins

Binance’s delisting of non-MiCA-compliant stablecoins implications for the cryptocurrency market in Europe. Other exchanges are likely to follow Binance’s steps. Coinbase and OKX preceded Binance in delisting non-MiCA-compliant stablecoins in the EEA. The continued delisting of these stablecoins by exchanges will lead to their reduced liquidity, market presence, and complete removal from the EEA. Also, this will potentially impact their usability in Europe including for cross-border transactions.

These developments show the need for compliance with stringent regulations like MiCA. The issuers of the affected stablecoins must realize the importance of complying with applicable regulatory requirements to maintain market access. 

As holders of these stablecoins eventually convert them to MiCA-compliant pairs, there would be increased demand for such MiCA-compliant stablecoins as USDC and EURI.

MiCA regulation’s aim to enhance consumer protection and market integrity has both benefits and costs for issuers based on their compliance. 

Read also: MiCA: A Rundown of CASPs approvals–January 2025 edition  

 

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Jude Ayua is a policy analyst at CAB. A lawyer, Jude is an associate at Infusion Lawyers where he is a member of the Blockchain & Virtual Assets Group. He is also a member of the Policy & Regulations Committee of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN). Jude reports and writes on crypto policy and regulations. jude@infusionlawyers.com