USDT market cap sees biggest drop since FTX crash as MiCA takes effect

PANews reported on January 2 that according to CoinDesk, TradingView data showed that the market value of USDT fell nearly 1.1% to US$137.24 billion this week, the largest decline since the collapse of the FTX exchange in the second week of November 2022. In mid-December 2024, the market value of USDT reached a record high of US$140.72 billion.

Previously, several EU-based exchanges and Coinbase decided to delist USDT because it did not comply with the requirements of the EU Crypto Asset Market (MiCA) regulations that came into full effect on December 30. USDT is a gateway into the cryptocurrency market and is widely used by investors to fund spot cryptocurrency purchases and derivatives trading. As a result, delistings and falling market caps have fueled speculation on social media about an overall decline in the cryptocurrency market. However, these fears may be unfounded and the negative impact will be limited to the euro area at best.

Karen Tang, Asia Pacific head of partnerships at Orderly Network, said: “The EU will restrict access to Tether due to MiCA regulation, but this will not harm USDT’s dominance. The EU is not the largest cryptocurrency market. Most cryptocurrency exchanges This is happening in Asia and the United States and will only hinder digital asset innovation in the EU.”