Tether CEO Paolo Ardoino publicly explained on July 2 that USDT did not apply for the Electronic Money Token (EMT) authorization under the EU's Markets in Crypto-Assets Regulation (MiCA), stating that MiCA is "very dangerous for stablecoins." He said MiCA rules could force issuers to place 60% of reserves in uninsured cash deposits with small European banks, creating systemic risk in the event of large-scale redemptions.
Ardoino Statement: MiCA 60% Reserve Bank Deposit Requirement Clashes with Tether's Model
Paolo Ardoino publicly stated that MiCA requires stablecoin issuers to deposit 60% of reserves as uninsured cash deposits with European banks. If holders redeem on a large scale, the relevant small banks may be unable to cope, creating systemic risk. Tether's reserve model is based on U.S. Treasuries and global assets, and locking most of its funds in EU-regulated banks directly conflicts with its existing structure.
Ardoino called the legislation "very poorly considered" and said abandoning the MiCA application process was to protect over 400 million USDT users. Additionally, Tether quietly exited the European market after launching the euro-pegged stablecoin EURT in 2024, indicating that the exit decision had been foreshadowed.
USDT EU Delisting Timeline: Record of Phased Executions by Coinbase, Crypto.com, Binance, Kraken
Around the MiCA deadline, licensed platforms delisted USDT in batches:
December 2024: Coinbase Europe led the delisting of USDT
January 2025: Crypto.com followed suit, delisting USDT
March 2025: Binance restricted EU USDT trading pairs
Before July 1, 2026: Kraken first changed to allow only sells, then fully stopped support; Coinbase, Kraken, and Crypto.com removed USDT from EU order books on the final MiCA deadline
As of July 1, 2026, USDT can no longer be traded on any licensed platform compliant with EU MiCA regulations.
Circle USDC's MiCA Compliance Advantage: French EMI License and Preferred Status on EU Licensed Platforms
Circle took the opposite approach to Tether, obtaining an Electronic Money Institution (EMI) license in France, valid in all 27 EU member states. This makes USDC and Circle's EURC the only two stablecoins among the top ten fully compliant with MiCA standards, and they have become the preferred dollar payment option on virtually all EU licensed platforms.
The EU's restrictions on USDT have already prompted market makers operating USDT trading pairs in Europe to rebuild order books around USDC, with market liquidity restructuring in the short term.
Tether's Alternative EU Presence: Hadron Platform, StablR, Oobit, and Qivalis Plans
Although Tether has withdrawn from direct EU regulatory oversight, its ecosystem maintains a European presence through indirect means. StablR and Oobit have launched MiCA-compliant tokens (EURR and USDR) on Tether's Hadron tokenization platform.
In addition, a consortium of 37 EU banks, including BNP Paribas and ING Group, is jointly developing a unified euro stablecoin called Qivalis, aiming to reduce reliance on dollar-pegged alternative stablecoins. As of July 1, 2026, the EU had issued 244 MiCA licenses, and some crypto companies have shifted their business focus to alternative hubs such as Dubai.
Frequently Asked Questions
Why didn't Tether apply for a MiCA license?
According to a public statement by Tether CEO Paolo Ardoino, the main reason is that MiCA requires 60% of reserves to be held in uninsured cash deposits with small European banks, which directly conflicts with Tether's reserve model based on U.S. Treasuries and global assets, and creates systemic risk in a large-scale redemption scenario. Ardoino said abandoning the application was "to protect over 400 million users."
After USDT left the EU, which compliant stablecoins filled the market gap?
Circle's USDC and EURC became the only two stablecoins among the top ten fully compliant with MiCA standards. The EMI license obtained in France covers all 27 EU member states, and they have become the preferred dollar stablecoin on EU licensed platforms. StablR and Oobit have also launched two MiCA-compliant tokens, EURR and USDR, via Tether's Hadron platform.
What is Qivalis, the project jointly developed by 37 EU banks?
Qivalis is a unified euro stablecoin project jointly developed by a consortium of 37 EU banks, including BNP Paribas and ING Group, aiming to reduce the EU market's dependence on dollar-pegged alternative stablecoins. The specific issuance timeline and technical architecture are subject to official announcements from the participating institutions.
