Tether (USDT), the largest stablecoin by market capitalization, is facing a major shift as it is delisted from European Union exchanges starting today. This move follows the implementation of the EU’s new MiCA regulations, which impose strict rules on stablecoin reserves. While this has sparked fear, uncertainty, and doubt (FUD) in the crypto market, crypto analyst Axel Bitblaze suggests that this could be a unique buying opportunity, similar to past FUD events surrounding Tether.
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— Axel Bitblaze 🪓 (@Axel_bitblaze69) December 29, 2024
➔ 5. NYDFS Slams Tether:
In December 2020, the NYDFS demanded Tether submit its financial papers amidst rumors that USDT was not fully backed.
During this period, BTC dropped 10%, and altcoins fell by 30%.
However, just weeks later, the biggest bull run began. BTC surged… pic.twitter.com/SpzLda8q7w
Why Is USDT Being Removed from EU Exchanges?
The delisting of USDT is directly tied to Tether’s failure to meet the reserve requirements outlined in the European Union’s MiCA regulations. These new rules require stablecoins to maintain adequate reserves, a standard that Tether has yet to fulfill, leading EU exchanges to remove it. However, this doesn’t mean that USDT is illegal in the EU. According to Bitblaze, EU investors can still hold USDT in non-custodial wallets and trade it on decentralized exchanges (DEXs), where MiCA regulations do not apply.
Is the Stablecoin Market in Trouble?
Despite the FUD surrounding Tether, Bitblaze remains confident in the strength of the stablecoin market. USDT currently holds a market cap of $138.5 billion, with daily trading volume reaching $44 billion, the majority of which originates from Asia. Bitblaze reassures investors that the value of their assets isn’t tied to the specific stablecoin they use. Whether it’s USDT, Bitcoin, or fiat, the safety of assets depends on secure storage rather than the choice of stablecoin.
Tether’s Resilience in the Face of Adversity
Tether has weathered similar storms in the past. For instance, in October 2024, when the U.S. government launched an investigation into Tether, Bitcoin’s price initially dropped by $2,000 before rebounding 43% shortly after Tether’s CEO denied the allegations. Other FUD events, such as attempts to depeg USDT, have caused temporary price drops, but these were followed by significant bull runs.
Tether FUD: A Historical Signal to Buy?
Bitblaze argues that Tether-related FUD has historically been a signal for buying opportunities. These events typically occur when the market is either at a low point or during a bull run, suggesting that investors should view this as a chance to accumulate. With the ongoing dominance of USDT in the stablecoin market, this temporary setback is unlikely to alter its long-term prospects.
Also Read: Bitget Launches AIXBTUSDT-M Futures with 75x Leverage
As the crypto market continues to evolve, Tether’s resilience and adaptability to challenges like these may ultimately reinforce its position as a cornerstone of the stablecoin ecosystem. Investors are encouraged to take advantage of current market conditions, with Bitblaze predicting stronger asset performance by early 2025.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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