EURC Market Cap Surges 136% as Euro Strengthens Against Dollar

Circle’s Euro Coin (EURC), a euro-pegged stablecoin, has experienced rapid growth in its market capitalization as the ongoing trade war has driven the US dollar price lower, making the euro more attractive. According to Alex Obchakevich, founder of Obchakevich Research, there has been a significant increase in interest in the euro, which has directly benefited EURC. The euro has appreciated by 2.2%, reaching its highest price since February 2022 at $1.13.

This surge in interest has led to substantial inflows into decentralized finance (DeFi) protocols. For instance, Aave saw €2.3 million of Euro Coin inflows in April alone. The capitalization of EURC has been growing at a rapid pace, with its market cap rising from under $84 million at the end of 2024 to more than $198 million as of mid-April, marking a 136% increase year to date.

The euro’s recent rally is closely tied to the weakening of the US dollar due to escalating trade tensions. Since the end of 2024, the dollar has declined from 0.97 euro to 0.88 euro, a 9.3% drop against the euro. This trend is expected to stabilize the euro at around $1.11 to the dollar, according to Obchakevich. He predicts that EURC will continue to grow through integration with various payment systems and blockchains, forecasting it to reach 400 million euros by the end of the year. This growth is anticipated to be further impacted by regulatory support from the Markets in Crypto-Assets (MiCA) and ongoing economic challenges.

Circle, the issuer of EURC and USDC, is benefiting from its regulatory-friendly strategy. EURC and USDC are the top euro and US dollar-pegged stablecoins that comply with the European Union’s MiCA regulation. While Tether’s USDt currently holds the largest market cap at $144 billion, many expect this gap to shrink as USDt faces regulatory pushback in the European Union. This trend is evident in the delisting of USDt by major crypto exchanges like Binance for their European Economic Area-based users to comply with MiCA regulations.

The growth of EURC underscores the increasing demand for compliant and stable crypto-assets in the market. As trade tensions continue to escalate and the euro strengthens, EURC is likely to see further growth. However, investors should remain cautious given the volatile nature of the crypto market and conduct thorough research before making any investment decisions.