Financial encyclopedia

USDT (Tether) has always been the dominant force in the stablecoin market, but there have been constant controversies recently! Binance announced that it will remove USDT and 9 stablecoins from the European Economic Area (EEA) before March 31 to comply with the European Union's Crypto Asset Market Act (MiCA). This further exacerbated the market volatility of USDT, and even briefly experienced a slight decoupling from the US dollar at 1: 0.997.

Will USDT follow in the footsteps of LUNA's collapse? Are the United States and the European Union working together to support USDC? Will the stablecoin market experience a major reshuffle?

Why does USDT decouple from the US dollar?

Opacity of reserve funds

USDT has long been questioned by the market due to its opaque asset portfolio, and investors are concerned about the authenticity and stability of its reserves.

Regulatory storm hits

The US SEC, Treasury Department, and EU MiCA Act impose stricter supervision on USDT, and exchanges implement restrictive measures in advance, compressing the survival space of USDT.

Large outflow of funds

Institutional investors are accelerating their withdrawal from USDT and shifting towards more transparent regulatory USDC. Even Binance encourages users to exchange USDT for USDC, and the market landscape is rapidly reshaping.

US and Europe join forces to support USDC?

USDC is issued by Circle and has close ties with US regulatory agencies, providing higher compliance and transparency. The EU MiCA Act and the US Treasury Department both emphasize "regulated stablecoins," which may mean that USDC is becoming the official preferred choice.

Regulatory agencies favor USDC, further enhancing its advantages

USDT faces greater regulatory risks and its dominant position is in jeopardy.

The US and Europe may hope that USDC can replace USDT and gain control over the global cryptocurrency market.

If USDT collapses, what impact will it have on the market?

Funds may flow towards gold, silver, and other potential beneficiaries.

The severe volatility panic of BTC&ETH may trigger a wave of selling.

Regulatory acceleration of stablecoin reshuffle: funds may shift towards USDC or wait for the emergence of digital dollars (CBDC).

USDT is facing regulatory pressure and its position is precarious, while USDC is favored by regulatory agencies. The United States and the European Union may push for more compliant stablecoins and even launch CBDCs. For investors, carefully evaluating their positions and adapting flexibly will be the wisest strategy at present!