Coinbase Restricts Non-MiCA Stablecoins in Europe, Circle's USDC and Quantoz's EURD Vie for Dominance

According to Algorand, Coinbase began notifying its European clients that it will begin restricting stablecoins that don’t meet Markets in Crypto Assets (MiCA) requirements tomorrow.

Coinbase is set to begin restricting services for several stablecoins that don’t meet Markets in Crypto Assets (MiCA) requirements on Friday, according to a notice posted by the Algorand Foundation.

The Proof-of-Stake blockchain and cryptocurrency foundation shared the notice from Coinbase on social media, highlighting the remaining MiCA-compliant stablecoins that its users could switch to.

“Dear Client, as a reminder, due to the new MiCA regulation, Coinbase will implement restrictions for stablecoin services that do not meet MiCA requirements,” Coinbase said in its notice.

“Based on the latest information, we currently expect we will have to restrict services for the following assets: USDT, PAX, PYUSD, GUSD, GYEN, and DAI.”

Coinbase Prepares for MiCA

Coinbase began notifying its European clients on Thursday that it will begin restricting stablecoins that don’t meet MiCA requirements, Algorand said.

The firm identified two stablecoins that are still available: EURD from Quantoz and USDC from Circle.

This news comes as several firms are vying for stablecoin market dominance in the EU following the entry of Markets in Crypto Assets (MICA).

Before this year, Tether was the dominant stablecoin in this market, but it quickly became apparent that the stablecoin giant would not meet compliance.

Several firms, including Circle and Quantoz, have touted their stablecoins as fully compliant with MiCA and have expressed interest in taking over Tether’s market share in the EU.

Meanwhile, Tether has scaled back its EU operations and invested in Quantoz, which launched one of two MiCA-compliant stablecoins that Algorand identified.

The other approved asset, Circle’s USDC, represents an effort to directly muscle in on Tether’s old territory.

On Thursday, Binance announced a partnership with Circle, which appears to be an attempt to expand in Europe.

Coinbase partially owns Circle, and thus, this public gesture took place despite these two massive exchanges’ rivalry.

With their combined capital and resources, the pair could make significant strides in the EU market.

For non-stablecoin crypto firms like Algorand, however, this “MICA market opportunity” might not impact regular operations.

The firm has enjoyed an impressive rally in recent months, and its announcement claimed that users could seamlessly use either USDC or EURD from Quantoz.

In other words, this “MICA market opportunity” is having a diminished impact on firms like Algorand. Its users can enjoy the same experience, and it isn’t the firm’s concern whether or not Tether can regain its market dominance.