Binance, the popular cryptocurrency exchange, will need to comply with the upcoming regulations on stablecoins set by the Markets in Crypto-Assets Regulation (MiCA) at the end of this month. In preparation for this, Binance has notified its users in the European Economic Area about the changes that will affect their services.
MiCA aims to establish standardized rules for crypto asset issuers that have not yet been regulated in the European Union. In response, Binance is categorizing stablecoins as either “regulated” or “unauthorized” based on their compliance with the new regulations.
To smoothly achieve the objectives of MiCA, Binance plans to gradually transition users from Unauthorized Stablecoins to Regulated Stablecoins as more of the latter become available in the market.
Binance has not yet received any rulings on which stablecoins are compliant or non-compliant with MiCA. Currently, only a few stablecoins meet the requirements set by MiCA.
To comply with MiCA, Binance will primarily rely on a “sell-only” strategy. This strategy will particularly apply to the Binance Convert function, which will only be available in a “sell-only” mode for Unauthorized Stablecoins.
Binance, which boasts 196.6 million users worldwide, stated in a blog post that it believes MiCA could have positive implications for the crypto and stablecoin industry.
MiCA was passed as a law in May 2023, and Binance is not the first exchange to take action ahead of its implementation. In March, OKX delisted Tether in Europe without explicitly mentioning MiCA. In September, Binance denied reports that it planned to delist all stablecoins in Europe, refuting a statement made by Binance France’s legal head, Marina Parthuisot.
Opinions among experts are divided on the impact MiCA will have on the European crypto market, but many have expressed favorable views on the regulation, particularly concerning stablecoins. Joachim Schwerin, an economist at the European Commission, stated that “MiCA could help us become more open to stablecoins as a whole.”
In other news, DeFi bots are significantly boosting the trading volume of Solana’s stablecoin, as reported by various magazines.
Binance readies itself for MiCA regulations, enhances stablecoin approach