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The phenomenon of euro stablecoins is increasing

Important facts:
  • EURT is the dominant euro stablecoin.

  • The capitalization of the euro-pegged stablecoins reached levels not seen in a year.

The market cap of stablecoins, which maintain price parity with the euro, rose by 3.37% in July to reach more than $336 million. According to analytics firm CCData, it marks its second consecutive rise in a month and its high in a year since July 2022.

As CriptoNoticias reported, this scenario is occurs after Come into effect of the Crypto Asset Market (MiCA) Regulation in the European Union in June and the publication of the first standards this month. This initiative defines the regulations that service providers with crypto assets in the region must comply with.

CCData sample The, the stablecoins Tied to the Euro, Euro Tether (EURT) remains the one with the largest market cap with a total volume of 160 million US dollars. It is followed by Euro Coin (EUROC) and Stasis Euro (EURS) with market caps of $47.25 million and $43.9 million, respectively.

The data company claims that the euro-pegged stablecoin’s capitalization surge was due to its transactions on centralized exchanges falling 54.4% to $55 million in June. This suggests that the utility of these tokens in decentralized finance (DeFi) applications is “more prominent,” he said.

The capitalization of the euro-pegged stablecoins reached the highest level since July 2022. Source: CCData.

As the graph shows, were last year The highest monthly trading volume for these coins on centralized exchanges was in March, for more than $200 million. After that, the monthly value was less than half and the last full month, June, saw a drop to $50 million.

This picture is similar to the overall stablecoin market, which also saw its highest trading volume in the last year in March. Unlike those pegged to the euro, however, they were up 16.6% in June to $482 billion, their first rise since March.

Overall stablecoin trading volume rose in June after two months of decline. Source: CC data.

This growth came after several investment firms, including BlackRock and Fidelity, submitted applications to launch spot Bitcoin ETFs. CCData He stressed that this “increased optimism and commercial activity in the market”..

Meanwhile, the total stablecoin market cap fell 0.82% to $127 billion, its lowest level since August 2021. This is the 16th consecutive month of decline, although not only the euro-pegged cap but also major stablecoin Tether (USDT) is gaining.

The total capitalization of stablecoins continues to decrease. Source: CC data.

USDT hit a new all-time high market cap in July of $83 billion. With this in mind, it remains the largest stablecoin on the market.

Those pegged to the euro make up 0.36% of the total stablecoins

This scenario occurs while both USDT and USD Coin (USDC), the second-largest cap stablecoin that is also pegged to the dollar, was trading at a discount on the Binance exchange in the United States. Its prices have fallen to $0.73 and $0.82 on the platform in July, while they should remain at $1.

This decoupling could be due to the shutdown of fiat trading on the exchange following the Securities and Exchange Commission (SEC) lawsuit earlier last month, CCData said. This suspension “has resulted in a drastic drop in liquidity” of USDT and USDC, resulting in devaluations of 27% and 18%, respectively.

According to CCData is given the lower liquidity Monthly trading volume on the exchange fell to $2 billion, its lowest level since November 2020. As CriptoNoticias reported, this also caused other assets to fall, including Bitcoin, which was trading $5,000 below the global reference price.

With this in mind, CCData believes that “Euro stablecoins could be configured to benefit from increased regulatory scrutiny in the United States.” suggested that could attract market cap through dollar-pegged stablecoins.

Currently, he pointed out that while the euro-pegged stablecoins are small compared to the dollar-pegged stablecoins, they represent the second largest sector of this market.

According to the discoverer CoinGecko, The market capitalization of these euro-pegged currencies is now 0.36% of the euro in total from the stablecoin market That’s $127 billion. Meanwhile, USDT and USDC continue to lead this market, dominating 65% and 20% of the total market, respectively.

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