MiCA-compliant stablecoins dominate European market
According to a Kaiko and Bitvavo analysis, the expansion of cryptocurrency in Europe is being driven by the region’s legislative frameworks.
As cryptocurrency acceptance expands in Europe and legal frameworks evolve, compliant stablecoins gain a sizable market share, indicating a substantial shift in their usage across the area.
A recent analysis from research firm Kaiko and Netherlands-based cryptocurrency exchange Bitvavo emphasizes the growth of cryptocurrency trading in Europe, with euro trading volumes increasing and stablecoin use adjusting to new rules.
Monthly trading volumes for the euro exceeded 2023’s average
The analysis found that euro-denominated trading volumes in 2024 were continuously above the 2023 average, with peaks in March and November exceeding $42 billion each month. Researchers believe this shows the euro’s growing significance in cryptocurrency markets.
In 2024, the euro was the third most-traded fiat currency in the cryptocurrency world, accounting for 7.5% of total fiat trading volume. The US dollar retained its supremacy, accounting for 49.9%, followed by the Korean won (33.4%).
MiCA-compliant stablecoins dominate market
Aside from the euro’s rising significance in crypto markets, the researchers identified a changing stablecoin landscape in Europe.
The implementation of the Markets in Crypto-Assets Regulation (MiCA) has substantially altered the region’s stablecoin ecosystem. These rules covering asset-referenced and electronic money tokens went into effect on June 30, and will be fully implemented by December 30.
On November 27, Tether, the stablecoin issuer, withdrew support for its euro-pegged stablecoin EURt (EURT) on all blockchains. Tether said the decision was consistent with its business objective, noting Europe’s “evolving regulatory frameworks” for stablecoins. The stablecoin company announced that it would no longer support EURT on any blockchains and would stop minting tokens.
Despite this, euro-backed stablecoins have survived, with monthly volumes reaching $300 million until 2024. November saw the largest trade volume, totalling approximately $800 million.
As of late 2024, MiCA-compliant stablecoins have seized the majority of the European market. Circle’s EURC, Societe Generale’s EURCV, and Banking Circle’s EURI accounted for 91% of the market by November.
Binance, a cryptocurrency exchange, has emerged as a prominent participant in the region’s stablecoin market, nearly matching Coinbase’s market share since listing EURI in August.
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