Circle, the first firm to launch a fully compliant stablecoin under the European Union (EU) framework under the Markets in Crypto-Assets (MiCA) law, has announced a significant milestone at a time when the cryptocurrency industry is experiencing a major market shift. USD Coin (USDC) issuer Circle stated it has successfully navigated the MiCA legal environment to launch Euro Coin, a stablecoin backed by the Euro (EUROC).
With this achievement, Circle becomes the first stablecoin issuer to fully comply with the stringent regulatory standards set forth by the European Union under MiCA, which aims to create a uniform and transparent regulatory framework for digital assets throughout the EU.
The accomplishment thrilled Circle CEO Jeremy Allaire, who explained the development by saying, “This is a significant milestone not only for Circle but for the entire cryptocurrency industry.” MiCA offers the regulatory protection and clarity required to promote the development and innovation of digital assets.
The European Parliament formally adopted MiCA earlier this year, laying out detailed guidelines for the issuance and use of stablecoins and other digital assets. The rule stipulates that issuers must follow Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) protocols, maintain reserves, and perform routine audits.
Tether CTO Speaks, Analysis Says Tether’s Exit Will Be Felt
The CTO of Tether, Paolo Ardoino, recently voiced doubts about the viability of conducting business under the strict guidelines set forth by MiCA. Ardoino said, “Despite its goal of promoting security and transparency, the EU’s legislative framework presents serious operational difficulties. We’re weighing our options on strategically moving to markets with more favorable regulatory environments.”
There might be a significant gap in the European stablecoin market due to Tether’s potential exit from the EU. The disappearance of USDT could affect market dynamics, including trading volumes and the availability of stablecoin options for customers in Europe.
Industry observers speculate that other stablecoin issuers may have more opportunities to gain market share due to Tether’s withdrawal. Blockchain specialist Clara Weiss commented that other compliant stablecoins, such as EUROC, will be able to fill the void left by Tether’s decision to leave the EU.
Tether May Be Forced to Reconsider Its Global Strategy
This might result in more competition and innovation in Europe’s stablecoin market. Comments have started flooding in from various industry professionals. Navacula Occumi, a popular cryptocurrency influencer, commented on Tether’s activities on his X handle.
According to Occumi, Tether has relied heavily on crossing incoming fiats with many redemption requests. He also stressed that the company (Tether) has yet to witness an inflow in fiat that will be enough to match fund redemptions.
This situation has persisted since the market capitalization of stablecoins and other cryptocurrencies went sideways. Occumi added that Tether can still absorb a little from the excess supply from its reserves but couldn’t convert them from Cantor and Treasury Bills to cash via the traditional banks of their choice.
Industry Players, Institutions Mount Resistance Against Tether
Consumers’ Research, the entity responsible for the TetheredToCorruption movement, has remained persistent in its campaign. The group has continued to use billboards and other advertorial means to enlighten the public about the human rights violations surrounding Tether operations and the leverage it creates for human traffickers.
The group recently disclosed its intentions to expand its awareness campaign by using mobile billboards in specific city locations, including Washington, DC, and New York. On June 25, a Fox Business reporter, Eleanor Terrett, posted a TetheredToCorruption image dangling on Senator Debbie Stabenow and Representative Chip Roy’s door hangers on his X handle.
He also posted other images containing flyers with a written message calling Tether a fraud riddled with investigations. One of the flyers called it the cryptocurrency of choice for the world’s bad actors. Eleanor Terrett’s story headlines have always linked Tether to terror financing and claimed it has close ties with China.