The European Securities and Markets Authority (ESMA) has issued guidance requiring authorized cryptocurrency platforms operating in the EU to stop offering services for stablecoins that do not meet the bloc's Markets in Crypto Assets (MiCA) regulations.
Platforms must cease allowing EU customers to purchase, trade, swap, or otherwise increase their holdings of noncompliant stablecoins. The largest stablecoin by market value, Tether's USDT, is a prominent example of tokens not authorized under MiCA rules. PayPal USD is also not authorized.
Three-Month Resolution Period
National regulators have been directed to require the resolution of any remaining customer holdings within three months of the guidance's publication, establishing a deadline of January 8, 2027.
During the wind-down period, platforms may provide limited services to resolve existing positions. These include selling, converting, withdrawing, transferring, or safekeeping tokens, but exclude new purchases, trading, or continued market promotion.
Scope of Compliance
MiCA's stablecoin rules, which began applying in June 2024, require issuers of dollar- and euro-pegged tokens offered to EU users to meet authorization, reserve, redemption, and disclosure requirements.
The ESMA guidance applies to all crypto-asset services including exchange services, trade execution, transfers, custody, administration, advice, and portfolio management. National authorities will determine how individual platforms handle remaining client balances within the three-month framework.
ESMA stated that maintaining noncompliant stablecoins through authorized platforms would undermine the reserve, redemption, governance, and disclosure standards that MiCA imposes on authorized issuers.
