Tether invests in European stablecoin issuer as USDT remains non-compliant with MiCA
Tether invests in European stablecoin issuer StablR as Europe’s MiCA rules approach implementation later this month.
The move indicates an effort to navigate regulatory conditions that require fully compliant stablecoin issuance within European markets. StablR, now backed by Tether, holds an Electronic Money Institution license from the Malta Financial Services Authority, allowing it to position its stablecoins as MiCAR-compliant assets. This investment comes at a moment when stablecoin issuers are under pressure to adhere to strict guidelines, with exchanges already delisting or planning to delist non-compliant tokens.
European Union regulators have pursued a unified approach through MiCA to ensure that stablecoin issuers maintain verifiable reserves and operate under standardized governance. Tether, historically dominant in global stablecoin volume, faces challenges as its flagship USDT encounters delistings from exchanges seeking full MiCA alignment.
Coinbase and others have taken steps to remove or limit access to tokens that do not meet these new rules. Instead of modifying its existing stablecoins directly, Tether appears to be leveraging investment in entities aligned with Europe’s regulatory landscape. Last month Tether invested in Quantoz, another project bringing euro-based stablecoins to market through Hadron.
By supporting StablR and Quantoz, Tether attaches its interests to stablecoins fully authorized for circulation under European oversight, potentially bypassing previous difficulties associated with EURT and other offerings.
StablR’s founder sees institutional and retail users seeking compliant, redeemable assets. StablR is using Tether’s newly launched token platform, Hadron, to simplify the tokenization process for regulated digital assets. Hadron streamlines the conversion of various asset classes into tokens while integrating compliance features and transaction monitoring. Tether’s stated support for European initiatives aligns with the region’s demand for reliability and adherence to MiCA’s standards.
The European stablecoin environment now includes products like StablR’s EURR and USDR; both issued as ERC-20 and Solana-compatible tokens. These stablecoins work within a regulated framework designed to offer predictable liquidity management and transparent collateral structures. Strict oversight has prompted issuers to focus on MiCA’s core requirements, including reserve composition and regular disclosures.
While Tether previously argued against elements of MiCA’s reserve mandates, citing systemic banking risks and lower returns compared to other investments, it now appears to be channeling resources toward entities meeting these criteria. By doing so, it highlights the importance of regulated pathways over direct confrontation with the rules.
In recent months, key industry participants have adjusted their strategies. Tether decided to discontinue support for EURT, signaling a retreat from efforts that did not align with the evolving regulatory backdrop. The shift toward investments in firms like StablR launching MiCA-compliant stablecoins represents a strategic pivot. Instead of challenging MiCA’s demands head-on, Tether invests in ventures prepared to operate within Europe’s legal framework.
As MiCA’s full set of provisions moves closer to enactment, issuers and investors anticipate stablecoin markets defined by standardization and risk management. By backing StablR’s regulated offerings, Tether secures a role in shaping this environment.
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