Following MiCA’s rollout, major crypto exchanges like Crypto.com and Coinbase have delisted USDT and other tokens.
While USDT faces challenges in Europe, Circle’s USDC has gained traction due to its MiCA compliance.
Tether acknowledges the MiCA regulatory framework’s role in supporting growth but emphasizes the complexity and risks it presents for EU-licensed stablecoins.
USDT stablecoin issuer Tether is on the back foot in Europe as the European Union (EU) rolled out its Markets ion Crypto Assets (MiCA) by December end. As a result, top crypto exchanges like Crypto.com have started delisting USDT from their platform. Tether has expressed strong displeasure with the developments in the European market, calling them “rushed actions”.
A spokesperson from the company recently said:
“It is disappointing to see the rushed actions brought on by statements which do little to clarify the basis for such moves”.
“It is disappointing to see the rushed actions brought on by statements which do little to clarify the basis for such moves”.
The stablecoin issuer further stated that the regulatory changes triggered by MiCA pose major risks for EU customers and the crypto market in that region. The company representative further added:
“These changes affect many tokens in the EU market, not only USDt, and we fear that such actions will lead to further risk being placed on consumers in the EU.”
“These changes affect many tokens in the EU market, not only USDt, and we fear that such actions will lead to further risk being placed on consumers in the EU.”
The stablecoin firm stated that such regulatory developments in the EU could lead to a “disorderly” market, especially as MiCA is still in its early implementation phase. However, Tether is not the only firm to face the brunt of MiCA regulations. Crypto.com’s delisting process will affect a total of 10 tokens that include popular names like Wrapped Bitcoin , stablecoin, and others.
Similarly, crypto exchange Coinbase, which delisted USDT in December 2024, has removed six tokens to align with MiCA regulations. Additionally, the exchange delisted WBTC across its platform for separate reasons on December 19, 2024.
Tether’s USDT Losing Ground to Circle’s USDC in Europe?
Tether emphasized that, beyond the broader consumer risks from potential ecosystem changes triggered by MiCA, the regulation also presents negative implications for stablecoins licensed within the EU.
“As we have consistently expressed, some aspects of MiCA make the operation of EU-licensed stablecoins more complex and potentially introduce new risks,” it said.
“As we have consistently expressed, some aspects of MiCA make the operation of EU-licensed stablecoins more complex and potentially introduce new risks,” it said.
Tether’s representative also reiterated the contrasting stablecoin use cases between Europe and emerging markets, where USDT is highly popular. “The USD stablecoin market is almost negligible in Europe,” the spokesperson pointed out.
While Tether’s USDT faces challenges in the European market, its competitor Circle’s USDC has already cemented its place by being MiCA compliant. Circle USDC has seen massive demand following the launch of Donald Trump’s TRUMP meme coin and MELANIA meme coin. Over the last month, the USDC market cap has surged by $8 billion or nearly 20% while that of Tether’s USDT has remained almost stagnant.
While Circle’s USDC is closing the gap with its top rival, Tether’s USDT still remains a dominant player with a $140 billion market cap. At the same time, Tether acknowledges the efforts of EU regulators in creating a structured framework, recognizing its crucial role in supporting growth within the sector. It noted:
“As Tether finalizes its European strategy for USDt, it remains committed to ensuring compliance with evolving regulations while introducing groundbreaking technologies such as Hadron and investments in transformative projects such as Quantor, designed to be MiCA compliant.”
“As Tether finalizes its European strategy for USDt, it remains committed to ensuring compliance with evolving regulations while introducing groundbreaking technologies such as Hadron and investments in transformative projects such as Quantor, designed to be MiCA compliant.”
