- Limit of $219 million for USDT and USDC, could stall adoption of cryptocurrencies
- But after Terra collapses, regulators may focus on stablcoins
The EU formally approved the MiCA rulebook on May 31 and most reviews were positive. However, lawyers are calling for a review of stablcoin clauses, namely transaction limits. They believe the use of stable coins could be limited by MiCA’s daily transaction limits.
Agnihotri and Reichel Cropper-Mower, legal director and partner at international law firm Clyde and Co. respectively, said the use of large stable coins could quickly lose popularity, and regulators should reconsider limits on their daily transaction limits.
Agnihotri added that after the Terra debacle and the USDC debacle, regulators have every right to focus on regulating private stabelcoins.
And Rachel Mower, said the current $219 million restrictions do not amount to a ban. And if that threshold is exceeded, issuers will need to halt further issuance and work with regulators to conduct transactions in compliance with that restriction.
Tether’s chief technology officer, Paolo Ardoyno, acknowledged that daily trading restrictions could have an impact on stablocoins such as USDT. However, he notes that the legislation stipulates that these restrictions apply when stabelcoin is used for a specific purpose.
He notes that the law stipulates that these restrictions apply when stabelcoin is used for a specific purpose.