The post Will MiCA Cripple Tether? Experts Disagree, Lean “No” appeared on BitcoinEthereumNews.com.

Now that MiCA has taken effect in the European Union, crypto experts are divided on how this may impact Tether. USDT’s market cap dropped sharply, but fears of a Tether collapse may be overblown. Several influential analysts, including Tether’s CEO, publicly said that this FUD may be an attempt to induce panic selling and, therefore, a cheap purchasing opportunity for more cynical investors. Tether’s USDT Reacts to MiCA Markets in Crypto Assets (MiCA) regulation has taken effect in the European Union, and the community is particularly anxious to see how it will impact Tether. When the deadline occurred on December 30, USDT’s market cap dropped by $2 billion. In fact, this was USDT’s biggest drop since the FTX collapse, when the stablecoin dropped over 5% in the second week of November 2022. So, it wasn’t long before some users took this as a sign of the bear market. Influential analyst Michaël van de Poppe stated that “the market could be crashing.” USDT Market Cap Over the Past Week. Source: TradingView To be fair, MiCA has presented several difficulties for Tether, which focuses on stablecoins. Coinbase began restricting USDT in the middle of December, but the EU soon directed all exchanges to delist it. Moreover, several competitors explicitly consider MiCA an opportunity to corner new market share. The market cap of Circle’s USDC, Tether’s biggest competitor, also surged by over $1 billion on deadline day. However, not everyone shares this bearish vision: “There’s a lot of misinformation spreading about USDT being deemed illegal in the EU. First of all, it will not be illegal to hold USDT in the EU. [Second,] 80% of USDT’s trading volume comes from Asia, so the EU delisting won’t have any severe impact. This is evident from USDT’s market cap, which is down by only 1.2%,”…

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Filed under: News - @ January 2, 2025 8:22 pm