In a significant move impacting cryptocurrency traders across Europe, Kraken has announced that it will delist Tether (USDT) along with four other stablecoins from its platform in the European Economic Area (EEA). This decision is primarily driven by the need to comply with the newly implemented Markets in Crypto-Assets (MiCA) regulations, which are set to reshape the landscape of digital asset trading in the region. The phased delisting process will begin in February 2025 and culminate with the complete removal of these assets by March 31, 2025.
Kraken’s decision to delist USDT is part of a broader trend among cryptocurrency exchanges responding to increasing regulatory scrutiny. Alongside USDT, the other stablecoins affected include PayPal USD (PYUSD), Euro Tether (EURT), TrueUSD (TUSD), and TerraClassicUSD (UST). This move reflects Kraken’s commitment to maintaining compliance with MiCA, which imposes strict requirements on stablecoin issuers within the EU.
The delisting process will unfold in several stages. Starting on February 13, 2025, margin trading pairs involving these stablecoins will be switched to “reduce-only” mode for EEA clients. This means that users will only be able to close or reduce their existing positions but will not be allowed to open new ones. By February 27, trading for these tokens will transition to “sell-only” mode, preventing users from generating new deposit addresses for the affected assets while still permitting trades.
As the deadline approaches, all spot trading for these stablecoins will cease on March 24, 2025. At this point, any open orders will be canceled, and clients will no longer be able to exchange these tokens for crypto or fiat currencies. The final phase of this transition will occur on March 31, 2025, when any remaining holdings in these stablecoins will be automatically converted into a MiCA-compliant stablecoin. After this date, any deposits made to existing addresses for these assets will only be available for withdrawal.
This decision by Kraken follows a similar announcement from Crypto.com, which also plans to delist USDT and nine other tokens in compliance with MiCA regulations. The European Securities and Markets Authority (ESMA) has been pushing for such measures to ensure a smooth transition into a more regulated environment for cryptocurrencies.
The implications of this delisting are significant for cryptocurrency traders in Europe. Many users rely on USDT as a stable asset for trading strategies, and losing access to it could lead to decreased liquidity and increased costs associated with trading. As exchanges like Kraken take proactive steps towards compliance, traders may need to rethink their strategies and consider migrating their holdings to MiCA-compliant stablecoins or alternative platforms.
Kraken’s decision also highlights a reversal from its previous stance regarding USDT. Just last year, Kraken’s global head of asset management stated that there were no immediate plans to delist USDT in Europe. However, as regulatory pressures mount, the exchange has shifted its approach to align with the evolving landscape of cryptocurrency regulation.
As we move closer to the March 2025 deadline, it is crucial for users affected by this change to take action. Kraken has advised clients to convert their holdings into MiCA-compliant assets or withdraw them before the automatic conversion occurs. This proactive approach not only protects users’ investments but also ensures that Kraken can continue providing services in compliance with regulatory requirements.
In conclusion, Kraken’s decision to delist USDT and other stablecoins marks a pivotal moment in the European cryptocurrency market as it adapts to new regulations under MiCA. As exchanges navigate these changes, traders must stay informed and prepared for the upcoming shifts in their trading options.
