Binance Restricts Some Stablecoins for Customers in Europe
Date: 2024-06-04 Author: Henry Casey Categories: BUSINESS
Cryptocurrency exchange Binance has announced significant changes to its policies regarding certain stablecoins. From June 30, 2024, the platform will begin to restrict support for “unauthorized” stablecoins for customers in the European Economic Area (EEA). This is due to the new requirements of the MiCA regulation governing this category of assets.
Reasons for introducing restrictions
In accordance with the provisions of the MiCA Regulation, from 30 June 2024, stablecoins in the EEA will be subject to strict regulation. Only companies that are properly authorized will be able to issue and promote stablecoins, which will be called “regulated stablecoins.”
“As of June 30 [2024], stablecoins in the EEA will be regulated. In practice, this means that only certain, regulated companies will be able to issue and promote public stablecoins,” Binance said in a statement.
Phased Transition Plan
Binance has developed a step-by-step plan to transition to using only regulated stablecoins. The platform is introducing restrictions on access to “unauthorized stablecoins” for all of its products available to EEA customers. These restrictions include:
- Selling, but not buying: From June 30, 2024, traders will only be able to sell “unauthorized stablecoins”, but will not be able to buy them.
- Continuation of Spot Pairs: Spot pairs with these assets will continue to operate until further notice.
- Binance Wallet Deposit: “Unauthorized stablecoins” will still be able to be deposited into the Binance wallet.
In addition to the main restrictions, Binance is also introducing measures regarding other services:
- Copy trading: Users are advised to close positions and withdraw funds before June 29, 2024.
- FDUSD Pool: This pool will no longer be available to traders from the EEA.
Market situation
Binance is not the only exchange to impose restrictions on some stablecoins in the EEA. In March 2024, OKX suspended support for USDT pairs in Europe, highlighting the severity and widespread nature of the changes in the industry.
The new rules introduced by the MiCA regulation significantly change the stablecoin market in Europe. Binance is preparing for these changes by introducing restrictions on “unauthorized stablecoins” and moving to only use regulated assets. These measures are aimed at complying with new requirements and providing security and transparency to its users.
