Tether: Big drop in market cap as MiCA takes effect
Tether's USDT, the world's largest stablecoin pegged to the dollar, has logged its steepest weekly decline in over two years.
Tether's USDT, the world's largest dollar-pegged stablecoin, has logged its steepest weekly decline in over two years. The market cap fell this week by more than 1 percent to about $137 billion. In mid-December it hit a record high of more than $140 billion. This decline followed several EU-based crypto exchanges delisting USDT from their platforms. Coinbase also removed the fiat equivalent from its platform. The stablecoin does not meet the European MiCA regulations, which fully took effect on December 30.
EU-based crypto investors can still hold USDT in wallets like Ledger or Exodus, but they cannot trade it on MiCA-compliant centralized exchanges (CEXes). USDT is considered a gateway to the crypto market and is often used by investors to buy cryptocurrencies and for derivatives trading. So, the delistings and the drop in market value on social media triggered speculation about a broader drop in Bitcoin, Ethereum, and other assets.
Karen Tang, head of APAC partnerships at Orderly Network, a Web3 liquidity layer, reassures in a post on X:
Meanwhile, Tether continues to boost its Bitcoin reserves. The company now holds 83,759 BTC, about 0.49 percent of the total circulating supply of Bitcoin. The crypto market, however, appears largely unfazed by the USDT market cap drop and is still in an upward trend at the start of the year.
