Kraken Delists Five Stablecoins in Europe Ahead of MiCA

Cryptocurrency exchange Kraken has announced its decision to delist five stablecoins, including Tether's USDT, from its European platform. This move is in response to the upcoming Markets in Crypto-Assets (MiCA) regulations in the European Union. The delisting process will commence on February 13, 2025, and conclude on March 31, 2025.

The stablecoins affected by this decision are PayPal USD, Euro Tether, TrueUSD, and TerraClassicUSD. Starting February 13, Kraken will set margin trading modes for these assets to reduce-only, allowing users to liquidate existing trades but preventing them from executing new ones. By February 27, trading will shift to sell-only, and the system will stop generating new deposit addresses. Spot trading will completely halt on March 24. The platform will convert any remaining stablecoin balances into another asset by March 31.

Kraken's decision aligns with the European Securities and Markets Authority's (ESMA) request for exchanges to wind down support for non-compliant stablecoins to avoid market distortion. Other major exchanges, such as Crypto.com and Coinbase, are also in the process of delisting USDT and other stablecoins. Crypto.com will stop supporting ten stablecoins by January 31, 2025, while Coinbase has already delisted eight tokens. Notably, Coinbase plans to delist USDT by December 2024.

Paolo Ardoino, Tether's Chief Technology Officer, has expressed concerns about the stringent regulatory framework in Europe, which he believes will slow down the development of stablecoins and limit retail access to the cryptocurrency market. The new MiCA business framework will also impose reporting requirements for crypto transaction accounts and the correction of errors within 30 days from April 2026.

As of February 2025, all identified crypto assets during tax audits that are not reported will be considered income. Kraken and other platforms are adjusting their policies to comply with the standards set by the European Union, ensuring continued access for their European users. Affected users are advised to exchange their stablecoin balances ahead of the automatic exchanges being implemented before the MiCA deadline.