In a stunning development for the cryptocurrency market, Tether, the company behind the world’s largest stablecoin USDT, has announced its decision to phase out its euro-pegged stablecoin EURT. The move comes as the European Union prepares to implement stringent new regulations for digital assets, known as the Markets in Crypto Assets (MiCA) framework, by the end of 2024.
Tether’s Euro Stablecoin Faces Regulatory Hurdles
According to a press release issued by Tether on Wednesday, the company has decided to discontinue support for EURT after careful consideration. Users will have until November 27, 2025, to redeem their EURT tokens. The decision has sent shockwaves through the crypto community, as it highlights the challenges stablecoin issuers face in complying with the EU’s forthcoming MiCA regulations.
MiCA Compliance Deadline Looms
The MiCA framework, set to come into full force by the end of this year, requires stablecoin issuers operating in the EU to obtain an Electronic Money Institution (EMI) license. Tether CEO Paolo Ardoino has been an outspoken critic of these new rules, arguing that they place an undue burden on stablecoin providers. To date, Tether has not secured the necessary EMI license to continue offering EURT in the EU.
We have made the difficult decision to wind down our euro stablecoin in light of the regulatory challenges posed by MiCA. Our focus now is on supporting innovative new ventures that align with the EU’s vision for digital assets.
– Tether CEO Paolo Ardoino
EURT’s Limited Market Presence
While Tether’s USDT dominates the stablecoin market with a capitalization of over $132 billion, EURT has struggled to gain traction. According to data from CoinGecko, EURT’s market cap stands at just $27 million, trailing behind competitors like Circle’s EURC ($90 million) and Stasis Euro ($130 million). This limited adoption may have factored into Tether’s decision to discontinue the token.
Tether’s New Ventures and Partnerships
Despite the setback with EURT, Tether remains committed to the European market through strategic investments and partnerships. The company recently acquired a stake in Netherlands-based stablecoin issuer Quantoz and launched a tokenization platform called Hadron. These initiatives aim to support smaller, MiCA-compliant stablecoin projects and leverage Tether’s expertise in the space.
We are excited to support the launch of Quantoz Payments’ MiCAR-compliant stablecoins, EURQ and USDQ, which will be powered by our cutting-edge Hadron technology. This partnership represents our ongoing commitment to innovation and growth in the European market.
– Tether CTO Paolo Ardoino
The Future of Euro Stablecoins
Tether’s decision to shutter EURT raises questions about the future viability of euro-pegged stablecoins in the EU. As the MiCA deadline approaches, other issuers will need to weigh the costs and benefits of compliance against the potential loss of market access. Some, like Circle, have already taken steps to secure the necessary licenses, while others may follow Tether’s lead and exit the market entirely.
The coming months will be critical for the stablecoin industry as it navigates this new regulatory landscape. While MiCA aims to provide greater clarity and protection for investors, it also poses significant challenges for smaller players and could lead to further consolidation in the market. As the situation unfolds, observers will be closely watching to see how issuers adapt and whether euro stablecoins can continue to thrive in a post-MiCA world.
