USDT’s full removal is set for March 31 of 2025. This move is similar to actions taken by other crypto exchanges like Crypto.com and Coinbase. Meanwhile, Kraken reported a 128% year-over-year revenue increase, reaching $1.5 billion in 2024, and resumed staking services in the US after settling with the SEC. Tether also reported record-breaking $13 billion in profits, driven by its expanding US Treasury holdings, though its market dominance declined.
Kraken Announces Phased Delisting of USDT
Kraken, one of the world’s leading crypto exchanges, announced that it plans to delist five stablecoins, including Tether’s USDT. The stablecoins will be delisted to comply with the European Union’s Markets in Crypto-Assets Regulation (MiCA). The move is similar to actions that were taken by other major exchanges like Crypto.com and Coinbase.
The exchange will fully remove support for USDT in the European market by March 31, 2025. Alongside USDT, Kraken will gradually phase out PayPal USD (PYUSD), Tether EURt (EURT), TrueUSD (TUSD), and TerraClassicUSD (UST). The company stated that the decision is necessary to ensure compliance with MiCA and to continue providing services to European clients in the long run.
Kraken outlined a structured delisting process in line with the European Securities and Markets Authority’s (ESMA) recommendations to prevent any disruptions in the crypto market. Starting Feb. 13, Kraken will set all margin trading pairs involving the affected stablecoins to “reduce-only” mode. This means that European users will only be able to close out existing positions.
By Feb. 27, trading for these assets will be limited to “sell-only” mode, preventing new deposits of these tokens but still allowing their sale. Finally, on March 24, Kraken will stop all spot trading for the delisted assets, automatically closing all open orders and exchanging holdings into other assets where applicable.
(Source: Kraken)
Clients in the EEA who still hold any of the affected stablecoins by March 31, 2025, will see their balances automatically converted into an equivalent compliant stablecoin. Any future deposits of these assets to existing Kraken addresses will only be available for withdrawal. The changes will impact users in the 30 EEA countries, including Austria, Cyprus, Czechia, Malta, Portugal, Spain, and Sweden.
Kraken’s move was made due to a broader regulatory push by European authorities to ensure that all stablecoins in circulation comply with MiCA rules by the first quarter of 2025. The ESMA previously urged crypto asset service providers to avoid abrupt delistings that could lead to market instability. To mitigate these potential disruptions, the agency advised exchanges to implement a gradual process starting with “sell-only” restrictions before fully stopping trading.
Kraken is not the only major platform adjusting to MiCA’s new requirements. Crypto.com also recently announced that it will delist USDT and nine other stablecoins. The exchange set a Jan. 31, 2025, deadline for full removal. The exchange stated that users who do not convert their holdings before the deadline will have their assets automatically converted to a MiCA-compliant stablecoin or another asset of equivalent market value. Coinbase, another major US-based exchange, preemptively delisted USDT and other noncompliant stablecoins in December of 2024.
Kraken Reports $1.5 Billion in 2024 Revenue
Kraken reported $1.5 billion in revenue for 2024, which is an impressive 128% year-over-year increase compared to 2023. The company also disclosed earnings before interest, taxes, depreciation, and amortization (EBITDA) of $380 million for the year. Kraken saw strong trading activity with $665 billion in trading volume conducted by over 2.5 million funded accounts as well.
Kraken 2024 financial performance highlights (Source: Kraken)
The release of Kraken’s financials happened after several developments that shaped the company’s trajectory. In November, the exchange decided to shut down its non-fungible token (NFT) marketplace just one year after its launch. Representatives for Kraken explained that the decision was made to redirect resources toward new product offerings and services. The NFT market experienced a big decline in 2024 after sales volumes dropped from around $3.6 billion in January to under $1 billion by September.
In December, Kraken was selected by the FTX bankruptcy estate to assist in the distribution of funds to former customers and creditors of the collapsed exchange. The payments are scheduled for the first two months of 2025 and could cause increased trading activity on Kraken’s platform as recipients either cash out or swap their recovered funds.
Meanwhile, exchange-traded fund (ETF) issuer Bitwise has predicted that Kraken will go public in 2025. This means that the company could list on stock exchanges alongside other major players like stablecoin issuer Circle, financial services firm Figure, and blockchain analytics company Chainalysis.
Kraken also resumed staking services for US customers after a two-year pause. The exchange previously stopped its staking program as part of a $30 million settlement with the US Securities and Exchange Commission (SEC) in February of 2023, after allegations that it offered unregistered securities through its staking platform. Now, residents in 37 US states can access staking for 17 digital assets through Kraken Pro, including Ethereum, Solana, and Polkadot.
Tether Reports $13 Billion in 2024 Revenue
Despite MiCA uncertainties, Tether reported record-breaking profits of $13 billion in 2024 after expanding its holdings of US government bonds. The company’s US Treasury portfolio is now worth approximately $113 billion. This is due to the increasing demand for USDT, which is backed 1:1 with highly liquid US dollar-denominated assets. The stablecoin’s total market cap stands at close to $139 billion, while Tether’s total reserves exceed $143 billion, according to independent accounting firm BDO.
In July, Tether revealed that its Treasury reserves are more than those of all but 17 governments worldwide, including Germany, the United Arab Emirates, and Australia. In addition to US Treasuries, Tether also holds gold and Bitcoin, which contributed to $5 billion of its 2024 profits. The company’s consolidated net equity, representing total assets minus liabilities, stands at $20 billion. Throughout 2024, Tether issued approximately $45 billion in USDT, with $23 billion minted in the fourth quarter alone.
Tether also expanded its regulatory footprint by securing a stablecoin issuer and digital asset service provider license in El Salvador, where it has now established its headquarters. Beyond stablecoins, the company also reinvested a portion of its earnings into various sectors, including sustainable energy, Bitcoin mining, data and AI infrastructure, peer-to-peer telecommunications technology, neurotech, and education.
(Source: Tether)
Despite its strong financial performance, Tether saw a decline in market dominance in 2024, with its share of the stablecoin market dropping to approximately 65% as rival stablecoin USDC gained more traction. USDC is issued by Circle Internet Financial, and it has a market cap of around $53 billion. It now dominates stablecoin supply on Solana by comprising almost 78% of the network’s stablecoin market.
USDC market cap over the past year (Source: CoinMarketCap)
USDC has been gradually gaining ground against USDT since December, particularly due to regulatory concerns surrounding Tether’s compliance with MiCA. Despite this, USDT is still the dominant stablecoin on centralized exchanges, holding an 82% market share.
This article was originally Posted on Coinpaper.com
