The EU's ESMA has required cryptocurrency companies to comply with the stablecoin new rules by March 31.

BlockBeats News, January 29th, according to FinanceFeeds, the European Securities and Markets Authority (ESMA) has requested cryptocurrency companies to comply with the EU's new stablecoin rules by March 31st. This regulation is part of the broader Markets in Crypto-Assets (MiCA) framework, requiring companies to restrict or delist stablecoins that do not meet the standards.

MiCA's stablecoin provisions will come into effect from mid-2024, but ESMA is now urging companies to complete the changes by the end of the first quarter. The regulatory body stated that until then, companies can hold non-compliant stablecoins for sale but cannot acquire more. It warned that delays could disrupt the market.

Only stablecoins authorized by EU national regulatory authorities will be allowed to continue trading. These tokens must maintain sufficient reserves and adhere to transparency and governance requirements. The new rules aim to ensure issuers have adequate liquidity and ensure that investors understand what they are buying.

Tether's USDT is one of the stablecoins under strict scrutiny. It is currently unclear whether Tether intends to apply for EU authorization. The company recently cited regulatory challenges as the reason for discontinuing support for its euro-backed stablecoin. Observers noted that as a "significant" stablecoin under MiCA, Tether's primary stablecoin may face stricter requirements, including higher capital reserves and tighter regulation.

As the ESMA deadline approaches, EU cryptocurrency exchanges and stablecoin issuers are under pressure to meet the new standards, or face the risk of missing out on access to the vast and growing digital asset market in Europe.