Circle’s USDC has surpassed Tether’s USDT in stablecoin trading volume against the euro, according to data from market intelligence firm Kaiko. USDC now accounts for 56% of this specific trading pair, a significant increase from 10% in January 2024. This shift correlates with major exchanges restricting USDT trading for customers in the European Economic Area under the Markets in Crypto-Assets Regulation (MiCA). Additionally, USDC has overtaken USDT in euro-denominated liquidity, with order books approximately 40% deeper than those of its competitor.
Despite these gains in the euro market, Tether remains the larger stablecoin globally, maintaining a circulating supply roughly 2.5 times that of USDC. Kaiko identifies stablecoin-to-euro pairs as critical entry and exit points for European cryptocurrency users. The regulatory landscape further supports USDC’s position; two weeks prior to the report, the European Banking Authority designated USDC as the EU’s first “significant e-money token” under MiCA. This classification subjects Circle to direct EBA supervision and stricter regulatory requirements.
Kaiko notes that the United States is adopting similar regulatory frameworks through the GENIUS Act, potentially leading to comparable shifts in American exchange activity. On October 21, the Office of the Comptroller of the Currency issued its first final rule under the law, establishing reserve and redemption standards for supervised stablecoin issuers effective January 18, 2027. From July 2028, US platforms will face restrictions on offering non-compliant stablecoins. Circle has pursued authorization in both jurisdictions, while Tether launched a separate US-focused stablecoin, USAT.
The displacement of USDT by USDC in euro trading pairs illustrates how regional compliance regimes can rapidly alter market structure within the global stablecoin ecosystem. By aligning early with MiCA requirements, Circle secured a dominant position in the European on-ramp and off-ramp infrastructure, effectively leveraging regulatory clarity as a competitive moat. This development underscores that liquidity depth and trading volume are increasingly driven by legal certainty rather than solely by network effects or total supply size.
Looking ahead, the parallel implementation of the GENIUS Act in the United States suggests a bifurcation in stablecoin strategy among major issuers. While Circle benefits from dual-jurisdiction compliance, Tether’s creation of a distinct US entity indicates an attempt to navigate divergent regulatory expectations without compromising its global operations. Market participants should monitor whether US exchanges begin mirroring European trends, restricting non-compliant tokens in favor of domestically approved assets, which could further consolidate Circle’s institutional standing across Western markets.
