Tether, the issuer of the world’s largest stablecoin, USD₮, has announced a significant decision: to discontinue support for EUR₮, the stablecoin pegged to the euro. This marks a crucial moment in the cryptocurrency sector and raises questions about the future of stablecoins linked to fiat currencies other than the dollar.
The official announcement, published on November 27, 2024, emphasizes that Tether will stop supporting EUR₮ on all blockchains, also ceasing the minting of the token. Users are invited to redeem their holdings within a year, given that the last minting request for EUR₮ was processed in 2022.
Why is Tether abandoning the euro EUR₮ project?
Tether has not provided in-depth details on the motivations behind this decision, but the context suggests some reasons.
The stablecoin EUR₮, despite being created to offer users an option linked to the euro, has never reached the level of adoption of USD₮. The dominance of the American dollar as a global reference currency is also reflected in the stablecoin market, where USD₮ continues to represent the main choice for investors and institutions.
Another factor could be related to regulatory complexity. Stablecoins pegged to currencies other than the dollar may face more fragmented regulations, especially in areas like the European Union, which is implementing stricter laws on cryptocurrencies through the MiCA (Markets in Crypto-Assets) regulation.
The decision by Tether to eliminate EUR₮ represents a significant change for users and for the cryptocurrency ecosystem. Although the market volume of EUR₮ was relatively modest compared to USD₮, the stablecoin represented an important resource for investors who prefer euro-pegged transactions.
The stablecoin sector pegged to currencies other than the dollar could be affected by this choice, prompting other companies to reassess their strategies. However, Tether has reiterated its commitment to supporting USD₮, which continues to dominate the market with a capitalization greater than that of all other stablecoins combined.
What should EUR₮ users do?
Tether has granted users a one-year transition period to redeem their holdings in EUR₮. This means that until November 27, 2025, it will be possible to convert EUR₮ into euros through supported platforms. However, the company has specified that it will not accept new issuance requests for EUR₮, consolidating the decision to cease the token’s operations.
Investors and traders holding EUR₮ are therefore invited to plan their strategies to avoid complications in the long term. The option to redeem the tokens represents a clear solution, but it is essential to act within the established timeframes.
The choice of Tether to abandon EUR₮ reflects a broader market trend to focus on stablecoins linked to the US dollar, which enjoy greater liquidity and adoption.
As the cryptocurrency ecosystem continues to evolve, this decision highlights how user demand and regulatory factors influence the strategies of the main companies in the sector.
For users who relied on EUR₮, it is time to consider alternatives and monitor any future developments. In the meantime, Tether will continue to strengthen the role of USD₮ as a fundamental pillar of the global stablecoin market.