Tether (USDT) Stablecoin Rocked by FUD, Dropping as Low as $0.9954 Amid MiCA Delisting Fears

Tether and USDT were top business and finance trends on Twitter over the weekend after certain posts circulated regarding supposed plans of other digital asset exchanges to delist USDT in the EU Monday.

Cryptocurrency stablecoin issuer Tether has been the subject of widespread fear, uncertainty, and doubt (FUD) talks within the cryptocurrency community, with its stablecoin USDT dropping as low as $0.9954 late Sunday.

To gauge the impact of FUD on USDT, a comparison can be made with the prices of its top rivals. Stablecoin USDC was trading at around $0.9998 late Sunday, while PayPal USD (PYUSD), another rising rival to USDT, was trading at the same price as USDC.

Among the newer contenders in the stablecoin space, Ripple's RLUSD was trading at a higher price than USDT over the weekend, settling at around $0.9996 late Sunday.

Tether's Pain Point: EU's MiCA Regulation

Even before the European Union announced its sweeping Markets in Crypto Assets (MiCA) regulation, there were concerns about Tether's compliance with crypto guidelines and whether it had enough reserves to back its U.S. dollar-pegged stablecoin.

However, the concerns escalated earlier this year when Consumers Research ran a billboard in Times Square, New York City, accusing the stablecoin giant of "corruption."

"We're sounding the alarm on the threat so-called 'stablecoin' @Tether_to poses to consumers and their suspicious business practices. Tether thrives in the shadows, refusing to be audited and constantly dodging fraud investigations," the consumer protection advocacy group said in a statement at the time.

Questions about Tether's compliance with MiCA regulations came into sharper focus after crypto exchange giant Coinbase announced that it will be delisting USDT, the unchallenged leader in the stablecoin market.

Coinbase told its users that "due to the new European Markets in Crypto-Assets (MiCA) regulation, Coinbase will implement restrictions for stablecoin services that do not meet MiCA requirements" at the end of the month.

Following the announcement that ultimately put a dent in Tether's stablecoin dominance, a spokesperson told Decrypt that the company was "finalizing its long-term plans for the region, where it remains committed."

Coinbase clarified that USDC and EUR Coin (EURC) are compliant with MiCA standards and thus will continue to be supported in the bloc.

Crypto Users React Differently to Fears Over $USDT's Future

Tether and USDT were among the top business and finance trends on X over the weekend after posts circulated regarding supposed plans by other digital asset exchanges to begin delisting USDT in the EU on Monday.

Some of the posts shared indicated that another crypto exchange giant, Binance, is reportedly "blocking European users from receiving USDT."

🚨 🚨 BREAKING NEWS:

Binance is blocking European Users from receiving USDT (Tether).

All European 🇪🇺 Crypto Exchanges must delist USDT by December, 30th, 2024 due to MiCA Non-Compliance. 🪙

RLUSD will be the game changer for European Crypto Exchanges.#XRP #RLUSD #XRPETF 💎 pic.twitter.com/2LNPeHBmIe

Samson Mow, a prominent figure in crypto and tech, pointed out that no other exchanges have announced that they are delisting USDT yet. He also posted a screenshot of the grace period that some EU member states have set for MiCA compliance.

Other than Coinbase (who is invested in Circle) no other exchange has plans to delist USDt in the short term for European users.

Local European regulators have a grace period of more than 12 months.

For the FUDsters, which exchanges have announced the delisting of USDt for… pic.twitter.com/Mtvyx5Exij

notably, crypto exchange OKX already announced that it was delisting some USDT pairs, including REN/USDT.

Tether has about six months to comply with MiCA rules, at least in some jurisdictions, but with other member states, the stablecoin issuer has more time to comply.

Some crypto observers and experts believe that USDT's delisting and price crash will hit Bitcoin hard. As the main foundation of the crypto market, if Bitcoin gets hit by a USDT collapse, it may be doomed to crash as well, as projected by @DeFi_Hanzo.

There is serious #Tether FUD circulating, and it seems to be organized. They are aiming for something to happen on January 1, 2025.

If this FUD were credible, the market would already be in chaos well before January 1.

What do you think? #Usdt $Usdt

Tether Urges Community to Cool Down

Amidst continuing fears and discussions about crypto exchanges in the EU potentially beginning to delist USDT on Monday, Tether CEO Paolo Ardoino had strong words for the stablecoin's "competitors."

If you look in the X bios of many of the people FUD