EU Approves 10 Stablecoins, Excludes Tether Amid Market Uncertainty

The European Union (EU) has granted regulatory approval to 10 stablecoin issuers under the Markets in Crypto-Assets (MiCA) regulation, while excluding the largest stablecoin issuer, Tether. This move highlights the EU's strict stance on crypto asset regulations and raises concerns about potential market restrictions and delistings of USDT within the bloc.

The approved stablecoin issuers include Banking Circle, Circle, Crypto.Com, Fiat Republic, Membrane Finance, Quantoz Payments, Schuman Financial, Societe Generale, StabIR, and Stable Mint. These firms have issued a combined 10 euro-pegged stablecoins and five US dollar-pegged stablecoins, aligning with MiCA's compliance requirements.

Tether's exclusion from MiCA approval has led to the delisting of USDT on some crypto platforms within the EU, given Tether's significant market capitalization of $141 billion. The future of Tether within the European market remains uncertain, sparking speculation about the stability of stablecoin markets under MiCA regulations.

Despite the setback, Tether is actively expanding its global footprint. The company has proposed acquiring a 51% stake in a South African energy company, signaling a diversified investment strategy beyond crypto assets. Additionally, Tether has increased its presence in the sports industry by investing in Juventus, aligning with its broader business model expansion into AI, biotech, and energy sectors.

Experts warn that MiCA's stringent rules could isolate the EU crypto market, making it less attractive to foreign firms. Crypto experts suggest that over-regulation might drive crypto companies to relocate outside the EU, reducing market competitiveness. While MiCA aims to provide regulatory clarity, some analysts believe the focus on compliance over innovation could limit options for European crypto users, potentially causing the EU to fall behind in the global crypto economy.

Tether's exclusion from EU approval under MiCA has sparked debates about regulatory fairness, with the stablecoin issuer calling the move "hasty and unwarranted." Meanwhile, investors are closely watching as MiCA-compliant stablecoin issuers take center stage in the European digital asset market.