The EU’s new Markets in Crypto-Assets regulation (MiCA) establishes strict rules for stablecoins like Tether’s USDt. To operate in Europe, issuers must secure a license, keep at least 60% of reserves in EU banks, and maintain full transparency through regular disclosures. Tether, however, rejects these regulations for several reasons. Their leadership argues that the banking rule could compromise stability by increasing reliance on traditional banks, particularly during market fluctuations. Additionally, Tether's executives express skepticism toward the proposed digital euro, concerned about potential privacy invasions. They emphasize that their users are primarily in countries facing economic instability, where USDT serves as a financial lifeline. Tether has noted that not complying with MiCA has led to exchanges like Binance and Kraken de-listing USDT trading pairs for users in the EU, impacting liquidity and trading options for users. Tether is shifting its focus to more favorable jurisdictions, highlighting the fragmented nature of global crypto regulations and the challenges they pose for operating in such an uncertain landscape.

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