Crypto.com Responds to New EU Regulations
Digital asset exchange Crypto.com has announced that it will suspend certain token services that are considered unauthorized under the European Union’s Markets in Crypto Assets (MiCA) legislation. This decision was communicated to clients in a statement released on Tuesday.
Services Affected by the Suspension
Starting January 31, 2025, Crypto.com will no longer offer services related to specific stablecoins, including Tether (USDT), PayPal USD, and Pax Dollar. Additionally, the platform will cease offerings for Crypto.com Staked ETH and Crypto.com Staked SOL. In response to this announcement, CoinDesk has reached out for comments from Tether, PayPal, and Paxos.
Understanding MiCA Regulations
The MiCA framework established by the European Union imposes strict regulations on all 30 countries within the European Economic Area. These rules mandate that stablecoin issuers and staking service providers must obtain the necessary authorization to operate within the EU.
A spokesperson from Crypto.com explained, “In line with MiCA regulatory requirements, we will suspend the purchase of affected assets on January 31, 2025.” This proactive measure highlights the exchange’s commitment to compliance with the evolving regulatory landscape.
EU Regulators Issue Compliance Warning
Last week, EU regulators issued a notice urging exchanges to ensure compliance with the new stablecoin regulations under MiCA within two months. The European Securities and Markets Authority (ESMA) specifically called on exchanges to cease offering unauthorized stablecoin tokens to clients in the EU.
Classification of Liquid Staked Tokens
According to insights from industry experts, Crypto.com Staked ETH and Crypto.com Staked SOL are categorized as Liquid Staked Tokens (LST) under the MiCA framework. Some of these LSTs may qualify as Asset Reference Tokens (ART) per MiCA’s regulatory definitions. As a result, Crypto.com has made the decision to delist these assets to align with regulatory requirements.
Conclusion
As the landscape of cryptocurrency regulation continues to evolve, exchanges like Crypto.com are taking necessary steps to comply with new EU laws. This suspension of services reinforces the importance of adhering to regulatory frameworks in the rapidly changing world of digital assets.
