Ethena USDe

EURC

USDe

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With the rise of the Markets in Crypto-Assets Regulation in Europe, questions have risen whether Tether’s USDT stablecoin could maintain its dominance for the long term. 
Data from rwa.xyz shows that Tether (<a href="https://crypto.news/price/tether/" target="_blank" rel="noreferrer noopener">USDT</a>) is currently dominating the stablecoin market with a 70% share and has a market cap of $115.67 billion. However, Tether CEO Paolo Ardoino has <a href="https://crypto.news/tether-ceo-eu-mica-regulation-puts-stablecoins-at-risk/" target="_blank" rel="noreferrer noopener">shared concerns</a> regarding the latest <a href="https://crypto.news/tag/mica/" target="_blank" rel="noreferrer noopener">MiCA</a> regulation which came into force on June 30.&nbsp; 
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 Stablecoin market data – Aug. 13 | Source: <a href="https://app.rwa.xyz/stablecoins?utm_source=substack&amp;utm_medium=email" target="_blank" rel="">rwa.xyz</a>
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Under the new law, stablecoin issuers like Tether and Circle would have to keep 60% of their assets in EU-based banks. While Ardoino believes this puts the stablecoin market at risk, his competitor has already become an early adopter. 
Circle, the issuer of USD Coin (<a href="https://crypto.news/price/usd-coin/" target="_blank" rel="noreferrer noopener">USDC</a>) already <a href="https://crypto.news/circle-debuts-euro-pegged-stablecoin-eurc-on-coinbases-blockchain/" target="_blank" rel="noreferrer noopener">launched</a> the euro-pegged stablecoin, EURC, on Coinbase’s layer-2 blockchain, Base. Per the report, EURC is completely compliant with the MiCA regulation and already has a market cap of $36.8 million. 
Luca Prosperi, the co-founder and CEO of M^0 Labs, told crypto.news that USDT’s dominance would depend on its use cases, for example settling retail trades. He added that “no mature market could expect one issuer to dominate 70%” of a market.&nbsp; 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 “While we do not know, ex-ante, what will be the landscape going forward, we expect Tether to decrease its market share to 10-30%.”&nbsp; <cite>Luca Prosperi, the co-founder and CEO of M^0 Labs, told crypto.news.</cite>
</blockquote> 
Maruf Yusupov, the co-founder of Deenar, told crypto.news that the adoption rate of stablecoins is still meager and at its very early stages. “Once the asset hits mainstream adoption, regulatory-compliant stables might outperform Tether in the long term,” he added. 
 You might also like: <a href="https://crypto.news/helium-sees-12-surge-amid-partnership-trials-with-major-us-carriers/"> Helium sees 12% surge amid partnership trials with major US carriers </a> 
<h2 class="wp-block-heading" id="are-stablecoins-winning">Are stablecoins winning?</h2> 
One of the main reasons behind the growth of stablecoins is the high market volatility as users turn to them as a safe haven. Per data from rwa.xyz, the number of total stablecoin holders increased by 8.3% over the past 30 days, reaching 114.15 million addresses.&nbsp; 
Ethena USDe (<a href="https://crypto.news/price/ethena-usde/" target="_blank" rel="noreferrer noopener">USDe</a>) reached a market cap of $3 billion in less than four months after its launch. Ripple <a href="https://crypto.news/ripple-begins-testing-rlusd-stablecoin-on-ethereum-and-xrp/" target="_blank" rel="noreferrer noopener">started privately testing</a> its RLUSD stablecoin on XRP Ledger and Ethereum. Ripple CEO Brad Garlinghouse claimed that the stablecoin would likely launch before 2025. 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 “The winning point for stablecoins remains their flexibility, ease of adoption, and convenience compared to fiat.” <cite>Maruf Yusupov, the co-founder of Deenar, told crypto.news.</cite>
</blockquote> 
However, M^0 Labs’ Prosperi believes that stablecoins have “no clear standard, no transparency metrics, appropriate regulation, and no liquidity unification layer.”&nbsp; 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 “This exposes users and holders to significant risk and provides an unfair economic advantage to currently dominating issuers.” <cite>Luca Prosperi, the co-founder and CEO of M^0 Labs, told crypto.news.</cite>
</blockquote> 
 Read more: <a href="https://crypto.news/polymarket-user-wins-nearly-1m-on-trumps-x-space-with-musk/"> Polymarket user wins nearly $1m on Trump’s X Space with Musk </a>

Tether’s USDT is dominant, but for how long?

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