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Circle, the stablecoin issuer, revealed its plans to terminate individual or consumer accounts by November 30. The information emerged when a crypto enthusiast, Evanss6, shared an image of an email he received from Circle on X, the platform formerly known as Twitter. Consequently, users discovered that functionalities like wiring and minting will cease to be available for these accounts.
Moreover, a representative from the company confirmed this change. The spokesperson stated,
“Circle is phasing out support for legacy consumer accounts and has notified individual consumers of this decision.”
However, it’s crucial to note that business and institutional Circle Mint accounts are exempt from this change and will continue to function.
Circle’s Move Seen as Preventive Action
As news of Circle’s decision spread across the crypto community, various speculations began to surface on X. Adam Cochran, a known crypto sleuth, inferred that Circle’s move might be a response to a potential depletion of their reserves. He hinted at the presence of a “network of individual accounts” acting as “KYC mules”, which are essentially intermediaries for money laundering. Hence, the decision to shut them down might be a preventive measure.
On the other hand, another crypto trader, tmnxeq, had a different take. According to him, Circle’s action could be a “cost-cutting/ restructuring exercise”. Additionally, Circle’s use of the term “legacy consumer accounts” in their statement might suggest these accounts weren’t generating the traffic or usage they once did.
Circle Faces Regulatory Challenges in U.S.
The company’s recent decision doesn’t exist in a vacuum. The company has been navigating a sea of challenges, particularly from regulatory entities in the U.S. Significantly, their ongoing legal tussle with the Securities and Exchange Commission (SEC) has caught the attention of many. The core of the dispute revolves around whether stablecoins, which are linked to other assets to maintain their value stability, should be regulated in the same way as traditional securities. Circle firmly believes they shouldn’t be.
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