MiCA: ESMA gives crypto platforms three months to address non-compliant stablecoins

The European crypto-asset framework takes a step forward with a deadline for platforms. ESMA asks cryptocurrency companies in the European Union to address their exposures to stablecoins that do not comply with MiCA. National regulators will therefore need to oversee this transition within a timeframe, while providers will have to review several services offered to European clients. This measure specifically concerns custody, transfers, and operations still allowing holding certain tokens that do not comply with European rules.

MiCA requires a phased withdrawal of non-compliant stablecoins

In its opinion, ESMA asks crypto service providers to cease services related to stablecoins that do not comply with MiCA. National authorities must require companies to address their remaining exposures as soon as possible. The deadline set cannot exceed January 8, 2027, although regulators may choose an earlier date.

This stance broadens the requirements presented by ESMA in January 2025. At that time, custody and transfers of certain non-compliant stablecoins could still remain possible. Now, these services can only continue temporarily, notably to allow clients to liquidate their existing positions within a supervised framework.

The new guidelines cover several activities regulated by MiCA. They notably concern trading, client asset custody, transfers, investment advice, and portfolio management. Platforms must also prevent their European clients from buying non-compliant stablecoins or increasing their existing holdings.

Three months to address remaining exposures

The timeline gives companies about three months to organize the exit from the affected positions. During this period, national authorities may authorize certain MiCA-related services to allow clients to sell, exchange, or withdraw their holdings. Companies may temporarily continue to custody or transfer these assets under close regulatory supervision.

However, ESMA asks providers to complete this process as quickly as possible. January 8, 2027, is the common deadline announced by the European authority. Nevertheless, national regulators retain the ability to impose earlier deadlines according to their supervisory framework.

ESMA did not name specific tokens in its opinion. Coinbase, for its part, has identified Tether’s USDT and PayPal USD as non-compliant stablecoins under MiCA. For its clients in the European Economic Area, Coinbase set October 30 as the withdrawal deadline for affected balances. Remaining amounts must then be automatically converted to USDC or another crypto asset or available currency.

This development also strengthens the distinction between authorized assets and those gradually leaving the European market. Platforms must therefore adapt their procedures, offers, and controls to comply with MiCA throughout this transition period within the European market.

The new deadline should accelerate adjustments by European platforms. Companies will need to identify affected positions, inform their clients, and organize authorized operations during the transitional period. For users, the priority is now to verify the affected assets and the terms proposed by their platform. MiCA thus enters a more concrete phase of implementation, with a deadline bringing closer the definitive handling of non-compliant stablecoins.