Lugh has stopped the production of stablecoin due to Mica
According to Defi Llama, the number of circulating Euro-pegged tokens EURL has fallen from about $2.8 million in March to less than $31,940 as of the time of writing
European company Lugh announced the cessation of its stablecoin EURL in anticipation of the entry into force of the MiCA regulation.
The issuer guaranteed the redemption of existing coins until August 30, 2024.
To receive compensation, visit the Lugh website.
"All EURLs were and will be guaranteed 1:1 by our reserve account, opened at Société Générale and monthly audited by Deloitte," the company noted.
According to Defi Llama, the number of circulating Euro-pegged tokens EURL has fallen from about $2.8 million in March to less than $31,940 as of the time of writing.
Lugh's statement followed Binance's announcement of limiting the availability of "unregulated stablecoins" in the European Economic Area (EEA).
As of June 30, European customers of the platform will have access to a conversion function for such coins in a "sell only" mode; at the same time, their purchase will be closed. These restrictions also affect the copy trading service, participation in programs Launchpad, Launchpool, Simple Earn and several other services.
Binance did not mention the largest by volume stablecoin USDT in its statement, but the potential impact of MiCA on it remains unclear.
Tether CEO Paolo Ardoino told The Block that the new European regulation "contains several problematic requirements."
"They can not only complicate the work of issuers, but also make EU-licensed stablecoins extremely vulnerable and more risky in operation," he said.
Ardoino emphasized the importance of consultations on regulatory technical standards with market players who need clear rules.
