MiCA boosts EUR stablecoins to 67% market share

The introduction of the European Markets in Crypto-Assets Regulation (MiCA) has significantly impacted the euro stablecoin market, based on a recent analysis by Kaiko.

The report highlights that MiCA's enforcement has led to a wave of delistings and changes in token offerings across major exchanges, reshaping the market landscape.

According to Kaiko, euro stablecoins that comply with MiCA regulations, such as Circle’s EURC and Société Générale’s EURCV, now control 67% of the market share. 

This growth is attributed to platforms like Coinbase, which overtook Binance as the leading market for euro stablecoins in August. 

Coinbase's dominance was partly driven by the removal of non-compliant tokens, while Binance continues to promote such stablecoins to users outside Europe.

The report also reveals that MiCA has had a gradual effect on USD stablecoins, particularly Circle’s USDC (CRYPTO:USDC), which saw its market share grow from 10% to 12%. 

Kaiko’s data suggests that, unlike the euro market, the shift in USD stablecoins has been less pronounced. 

Despite regulatory pressures, trading volumes for euro-backed stablecoins have stabilized around $30 million per week, down from $100 million before MiCA’s rollout in March.

Kaiko's research suggests that changes may continue in the stablecoin market, with particular focus on USD stablecoins. 

Coinbase has announced plans to delist Tether (CRYPTO:USDT) for European users by the end of the year, a move that could shift market dynamics further. 

While USDT does not comply with MiCA, it remains widely used globally. 

Kaiko's analysis indicates that despite these regulatory challenges, USDT continues to maintain a strong presence outside Europe.

The changes prompted by MiCA are seen as part of broader efforts to standardize the digital asset market in Europe, pushing for increased regulation and compliance. 

According to Kaiko, the new framework is poised to influence the stablecoin market significantly, especially as more exchanges adapt their offerings to meet regulatory standards.