defi · · 2 outlets
EU rules drive USDC to 56% of euro stablecoin trading since January 2024
Since December 2023, USD Coin [USDC] has seen its share of euro-paired stablecoin trading climb from 10% to 56% as of October.
This increase coincides with exchanges imposing restrictions on Tether [USDT] under MiCA.
At the close of 2024, volume for euro-paired stablecoin trading neared $10 billion monthly before decreasing in subsequent months. The rise in USDC transactions is a direct result of the MiCA restrictions placed upon Tether [USDT].
Julia Kovalchuk, Head of B2B Product at Paybis, a crypto and fiat infrastructure provider licensed under MiCA, stated in an exclusive interview with AMBCrypto, "After MiCA, USDC grew from about 21% to 75% of stablecoin volume among our payment-firm clients in a year."
Furthermore, since Tether was denied entry into euro markets, USDC order books paired with the euro now exhibit 40% greater depth compared to USDT/EUR order books. This depth allows for larger euro-paired stablecoin trades without inducing significant price volatility, benefiting traders converting euros to dollar-backed stablecoins.
The shift demonstrates how regulatory actions can redirect trading activity and liquid assets between different stablecoins. MiCA set a July 2026 deadline requiring all stablecoin issuers to secure EU authorization and prove compliance with reserve and supervision mandates.
In response to these regulations, Coinbase commenced restricting USDT trading for its European clientele. The European Banking Authority also designated USDC as a significant e-money token in mid-October, subjecting it to direct supervision.
This transition reflects a broader trend within the European regulatory environment. Jurisdictions such as the US GENIUS Act, Hong Kong’s Stablecoins Ordinance, and the UAE’s payment token rules signal a similar direction.
While the global supply of USDT is 2.5 times that of USDC, the 56% level for USDC in euro-paired trading highlights the market's responsiveness to regulation. This market leadership change underscores evolving dynamics within the European regulatory landscape.
The Ethereum [ETH] stablecoin ecosystem has expanded, reaching over 300 million holder addresses. However, Kovalchuk noted that this figure does not equate to an equivalent number of active, unique users, as roughly three-quarters of these holders are situated on layer two networks.
This movement toward regulated infrastructure and shifting market share indicates that institutional participants are adjusting operations to meet evolving mandates.
Why it matters
The shift in stablecoin leadership demonstrates how regulatory frameworks, like MiCA, are actively reshaping market activity and asset liquidity. Readers should watch how compliance requirements affect which stablecoins can operate within regulated European markets. This trend highlights the growing importance of regulatory access in determining market dominance.
Earlier coverage
Reported by CoinTelegraph and ambcrypto.com.
Topics: defi, regulation, exchange.
