USDC Surges Past USDT in Euro Stablecoin Race—What EU Regulations Mean for the Future of Crypto Trading

Who would have thought that in the high-stakes world of stablecoins, Circle’s USDC would completely flip the script against Tether’s USDT when it comes to trading against the euro? It almost feels like watching a plot twist unravel in a gripping drama — one moment USDT was comfortably leading, the next, USDC is grabbing a whopping 56% of the market share, skyrocketing from a mere 10% at the start of 2024. What on earth triggered this rapid shift? Well, it seems the European Union’s knack for favoring bloc-compliant stablecoins under the strict Markets in Crypto-Assets Regulation (MiCA) has played a starring role — limiting USDT access in the European Economic Area and opening the doors wide for USDC’s ascent. Now with order books 40% deeper than USDT’s and the EU’s banking authority tagging USDC as the first ‘significant e-money token,’ one can’t help but wonder if we’re witnessing the dawn of a new regulatory-powered era for digital currencies. Is this the market’s way of saying, “Adapt or fade away”? Buckle up — the stablecoin saga just got a whole lot more interesting. LEARN MORE.

Circle’s USDC (USDC) has overtaken Tether’s USDt (USDT) in stablecoin trading against the euro, as European Union regulations increasingly favor bloc-compliant stablecoins, according to a new Kaiko report.

USDC now accounts for 56% of stablecoin trading against the euro, up from just 10% in January 2024, according to Kaiko data. The shift accelerated after major exchanges restricted USDT trading for customers in the European Economic Area under the Markets in Crypto-Assets Regulation (MiCA).

USDC has also overtaken USDT in euro-denominated trading liquidity, with its order books now roughly 40% deeper than its rival’s. Tether remains the larger stablecoin globally, with a circulating supply about 2.5 times that of USDC.

Kaiko described stablecoin-to-euro trading pairs as a “main on-ramp and off-ramp for European customers,” allowing them to exchange euros for US dollar-pegged stablecoins when entering or exiting cryptocurrency markets.

USDC-to-euro trading pair overtakes USDC-to-USDT. Source: Kaiko

The findings come about two weeks after the European Banking Authority designated USDC as the EU’s first “significant e-money token” under MiCA, a classification that places the stablecoin under direct EBA supervision and subjects its issuer to additional regulatory requirements.

US stablecoin rules could shift the balance between Circle and Tether

Kaiko said the US is taking a similar approach to stablecoin regulation under the GENIUS Act, raising the possibility that American exchanges could see the same shift in trading activity observed in Europe.

On Oct. 21, the Office of the Comptroller of the Currency issued its first final rule under the law, establishing reserve and redemption requirements for stablecoin issuers under its supervision, effective Jan. 18, 2027.

Beginning in July 2028, US platforms will also face restrictions on offering stablecoins from issuers that do not meet the law’s approval requirements.

The regulatory changes could favor Circle, which has pursued authorization in both Europe and the US. Tether has taken a different approach, launching a separate US-focused stablecoin, USAT.