Circle Scoops Up EU Market Share as Tether's USDT Exits

The EU's Markets in Crypto-Assets (MiCA) regulation came into effect on July 1, marking a significant deadline for virtual-asset firms. As a result, licensed exchanges are removing Tether's USDT from their platforms, while Circle is stepping in to fill the gap.

Circle had prepared for this moment by securing MiCA compliance for both its USDC and euro-denominated EURC stablecoins. Among the top ten stablecoins by market cap, Circle is the only issuer that cleared this bar. In contrast, Tether never applied for the e-money-token authorization required by MiCA.

Tether's CEO Paolo Ardoino has publicly defended the company's decision not to restructure its reserve model to meet MiCA's 60% requirement for European bank deposits, choosing instead to prioritize markets outside the EU. This move leaves USDT locked out of licensed European exchanges, with around $185 billion worth of the stablecoin affected.

The timing of this shift favors Circle, as BNY Mellon confirmed just a day before the deadline that it has made USDC the first stablecoin on its Digital Asset Custody platform. This move gives institutional clients the ability to store, transfer, mint, and burn USDC through the platform, providing Circle with regulatory validation on two continents in the same week.