MiCA Under scrutiny: Tether’s Stance

Paolo Ardoino, CEO of Tether, has voiced significant concerns regarding the European Union’s markets in Crypto-Assets (MiCA) framework. Speaking at the Token2049 conference in Dubai,Ardoino suggested that MiCA poses a considerable risk to stablecoins and could perhaps destabilize smaller European banking systems. His statements highlight a growing debate about the balance between regulation and innovation in the cryptocurrency space.

Tether,the issuer of USDT,the world’s largest stablecoin with a market capitalization of approximately $14.9 billion, has notably chosen not to register USDT under MiCA. This decision, according to Ardoino, is a deliberate move to protect the interests of over 400 million USDT users globally, many of whom reside outside Europe.He argues that MiCA’s stringent requirements could inadvertently harm these users.

Potential Impact on European Markets

Ardoino fears that complying with MiCA could force European exchanges to delist USDT. He also expressed apprehension about the regulation’s potential impact on smaller European banks. Specifically, he pointed to MiCA’s requirement for EU banks to maintain 60% insurance coverage, suggesting this could lead to financial instability and even bankruptcies within the European banking sector.

The MiCA license is very dangerous for the stable coin, and it is indeed a greater risk to European small and medium banking systems.
Paolo Ardoino, CEO of Tether

This concern is amplified by the recent actions of cryptocurrency platforms like Kraken and Crypto.com. Following MiCA’s official regulation in December 2024, Kraken listed five stablecoins, excluding USDT, while Crypto.com announced plans to delist ten stablecoins, including USDT, from it’s European platform. These actions suggest a cautious approach by exchanges in response to the new regulatory landscape.

Global Strategy: Bitcoin Reserves and US Expansion

While Tether is hesitant about MiCA compliance, the company is actively exploring other avenues for growth and diversification. Ardoino mentioned that the united States requires different product strategies due to competition from local stablecoin issuers. He also highlighted a growing trend among companies to increase their Bitcoin reserves.

This strategy aligns with a broader movement within the cryptocurrency industry towards greater adoption of Bitcoin as a reserve asset. As Bitcoin education expands, Ardoino believes more companies will follow suit, recognizing the long-term value and stability of the cryptocurrency.

Tether’s recent disclosure of holding US $120 billion in US Treasury bonds as of the first quarter of 2025 further underscores its commitment to maintaining a robust and diversified reserve portfolio. This level of openness aims to build trust and confidence in the stability of USDT.

Central Bank Control Concerns

Ardoino also voiced concerns about the underlying motivations behind MiCA, suggesting that the regulations may be driven by a desire to control consumer spending and expenditure, especially by the European Central Bank (ECB). He believes that the regulations, while presented as consumer protection measures, could ultimately limit financial freedom and innovation.

Europe loves more, but I think it’s intended to control people’s consumption and expenditure, which is more interested in the European central bank (ECB).
Paolo Ardoino, CEO of Tether