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Lugh Halts Euro Stablecoin Amid MiCA Regulations

Mica

Ahead of the European Union’s Markets in Crypto-Assets Regulation (MiCA), euro-pegged stablecoin issuer Lugh seems to be flitting away.

The Paris-based company announced on its website and on X, “Due to the upcoming entry into force of MiCA and in accordance with its commitment to compliance, LUGH announces the cessation of the issuing of its stablecoin EURL and guarantees the redemption of existing EURLs until August 30, 2024.”

Following Binance, the biggest cryptocurrency exchange in the world by trading volume, Lugh’s decision comes on top of that, stating it will shortly limit availability in the EU to stablecoins deemed “unregulated.” Although Binance did not specifically name any stablecoins like Tether’s or Circle’s, there is worry about European citizens’s access to the two most used tokens being limited by MiCA.

Related: EU’s ESMA Proposes Regulating MEV as Market Abuse

Regarding Lugh, the small circulation of the euro-pegged stablecoin has been shriveling recently. DefiLlama reports that circulation for Lugh’s EURL token has dropped from over $2.8 million in March to roughly $32,000 as of Tuesday, implying most holders may have already used their tokens.

Lugh said accessing the issuer’s website allowed consumers to redeem their tokens.

“All EURLs have been and will continue to be guaranteed 1:1 by our reserve account opened at Société Générale and audited monthly by Deloitte,” the company further added.

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