Tether’s market capitalization has fallen by 1.5% over the past seven days due to the introduction of wide-ranging MiCA regulations across euro area crypto service providers on December 30th. These regulations include strict rules for global stablecoin providers, as some European exchanges have begun delisting USDT.
Leading stablecoin Tether (USDT) has lost 1.5% of its market cap in the past seven days, falling from $139.46 billion to $137.32 billion after widespread MiCa restrictions began on December 30 did.
In accordance with regulations, European exchanges have begun delisting USDT from their crypto lineups, which is directly contributing to the decline in USDT’s market share and market capitalization.
MiCA rules for stablecoins
The Market for Cryptoassets (MiCA) Regulation was approved in June 2024, while a broader regulatory framework for cryptoasset service providers began on 30 December.
According to the new framework, dollar-denominated stablecoins such as USDT and USDC will be regulated to limit their dominance within the EU, and the use of euro-pegged stablecoins for payments and transactions will be encouraged.
While dollar-pegged stablecoins are not completely banned (users can hold them in decentralized wallets), they are subject to stricter rules (such as maintaining 30% reserves in traditional banks, which impact cash flow). ), and its use at domestic registered exchanges is restricted. european union.
Industry insiders’ comments do not faze them, as the majority of USDT trading and trading comes from Asia and the US, where USDT is not restricted.
Meanwhile, Tether CEO Paolo Ardoino retweeted a post stating that Tether’s daily trading volume had exceeded that of the second-ranked stablecoin by 14 times by December 31st.
🔥 https://t.co/IAOAkFjvM8
— Paolo Ardoino 🤖🍐 (@paoloardoino) December 31, 2024
