USDC Overtakes USDT in Euro Stablecoin Trading

Circle's USDC has overtaken Tether's USDt in stablecoin trading against the euro, capturing 56% of the market up from 10% in January 2024, according to a report by Kaiko. The shift accelerated after major exchanges restricted USDT trading for customers in the European Economic Area under the Markets in Crypto-Assets Regulation.

Liquidity and Regulatory Shifts

Beyond trading volume share, USDC has also surpassed USDT in euro-denominated trading liquidity. Order books for USDC are currently roughly 40% deeper than its rival's, though Tether remains the larger stablecoin globally with a circulating supply approximately 2.5 times that of USDC.

The findings follow the European Banking Authority's designation of USDC as the European Union's first significant e-money token under MiCA. This classification places the stablecoin under direct EBA supervision and subjects its issuer to additional regulatory requirements. Kaiko noted that stablecoin-to-euro trading pairs serve as a primary on-ramp and off-ramp for European customers entering or exiting cryptocurrency markets.

Potential US Regulatory Impact

Kaiko reported that the United States is taking a similar approach to stablecoin regulation under the GENIUS Act, raising the possibility that American exchanges could experience a comparable shift in trading activity. The Office of the Comptroller of the Currency issued its first final rule under the law on October 21, establishing reserve and redemption requirements effective January 18, 2027.

Beginning in July 2028, US platforms will face restrictions on offering stablecoins from issuers that do not meet approval requirements under the law. These regulatory changes could favor Circle, which has pursued authorization in both Europe and the United States, while Tether has launched a separate US-focused stablecoin named USAT.

Key facts

• USDC accounts for 56% of stablecoin trading against the euro, up from 10% in January 2024.
• USDC order books are roughly 40% deeper than USDT in euro-denominated trading.
• Tether holds a global circulating supply about 2.5 times that of USDC.
• The European Banking Authority designated USDC as the European Union's first significant e-money token under MiCA.