Tether exits EU stablecoin market over MiCA's 60% bank-deposit rule

Overview

Updated 1 hour ago

Tether, the company behind the world's largest stablecoin, has walked away from Europe's crypto licensing regime. CEO Paolo Ardoino said the company won't seek a Markets in Crypto-Assets (MiCA) license because the rules force large stablecoin issuers to park at least 60% of reserves in commercial bank deposits — money that banks lend out and may not have on hand during a redemption rush.

The twist: Europe's own central banks back Tether's critique. In September 2026, the European System of Central Banks — the European Central Bank plus all 27 national central banks — told the European Commission to scrap the deposit floor and replace it with liquidity-based requirements. The rule is still law, and USDT has been delisted from EU exchanges since July 1.

Why it matters

Europe's 60% reserve rule keeps the world's largest stablecoin out of its market — unless the Commission follows its own central banks and scraps it.

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Key Indicators

$187.75B

Tether's total reserves (June 30, 2026)

Of which $114.96B, about 61%, sits in US Treasury bills.

60%

MiCA bank-deposit floor for significant stablecoins

The minimum share of reserves tokens classified as significant must hold in commercial bank deposits.

~$112B

Bank deposits Tether would need at the 60% floor

A rough estimate based on Tether's reported reserves; the actual figure depends on how MiCA classifies USDT.

$40M

Tether's actual cash and bank deposits

Tether holds almost no bank deposits today, favoring US Treasuries and reverse repos instead.

EU national central banks urging the rule's removal

The ESCB — ECB plus all member-state central banks — recommended replacing the deposit floor with liquidity thresholds.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

Paolo Ardoino

Chief Executive Officer, Tether

Leading Tether's decision to operate outside MiCA's licensed framework

Organizations Involved

Tether

Private company (stablecoin issuer)

Operates outside the EU's MiCA framework; USDT delisted from EU exchanges since July 1, 2026

Issuer of USDT, the world's largest stablecoin by market capitalization.

European System of Central Banks

Central banking system

The ESCB comprises the European Central Bank and the national central banks of all 27 EU member states.

European Commission

EU executive body

Reviewing MiCA; received the ESCB response; holds power to propose rule changes

The Commission runs the MiCA review and would draft any amendment to the current rules.

European Banking Authority

EU regulatory agency

Drafted the liquidity standards the ESCB now cites as the deposit floor's replacement

The EBA sets prudential rules for EU banks and drafted technical standards on stablecoin liquidity in 2024.

Timeline

June 2024 September 2026

5 events Latest: Yesterday

Tap a bar to jump to that date

September 2026
Tether walks away from EU MiCA licensing over 60% reserve rule
Latest Statement

CEO Paolo Ardoino says Tether won't apply for a MiCA license while the 60% bank-deposit requirement stands, calling it a risk for users.
Yesterday
EU central banks urge Commission to scrap 60% deposit floor
Regulatory proposal

The ESCB tells the European Commission the fixed deposit thresholds push risk into banks and suggests liquidity-based limits instead.
4 days ago
July 2026
MiCA transition period ends; EU exchanges delist USDT
Market

Licensed EU exchanges stop supporting USDT as the transition period for firms operating under national rules lapses.
July 1st, 2026
December 2024
Broader crypto-asset service provider rules begin applying
Regulation

MiCA's wider framework for exchanges and other crypto service providers takes effect across the bloc.
December 30th, 2024
June 2024
MiCA's stablecoin rules take effect across the EU
Regulation

The stablecoin titles of the Markets in Crypto-Assets Regulation begin applying, setting reserve and redemption rules for e-money tokens.
June 30th, 2024

Scenarios

EU scraps stablecoin bank-deposit floor in MiCA review

Possible Resolves by Q3 2027

Discussed by: Coverage by CryptoSlate, Coinpaprika, and The Crypto Times of the ESCB recommendation

The Commission adopts the ESCB's recommendation, replacing the 30% and 60% deposit floors with liquidity thresholds tied to assets maturing within one and five working days. Draft EBA standards — 40% of reserves liquid within one day for significant tokens, 60% within five — supply the template. Removing the floor would not authorize USDT or settle Tether's broader objections; the company would still need a MiCA license to return.

EU keeps 60% deposit rule; USDT stays off licensed exchanges

Possible Resolves by Q3 2027

Discussed by: Observers noting the Commission has not committed to the ESCB's position

The Commission declines or delays acting on the ESCB response. The 60% floor remains law, USDT stays delisted from licensed EU exchanges, and Tether's users keep transacting outside the licensed channel. The standoff persists indefinitely, with both sides holding position.

Tether issues a separate MiCA-compliant stablecoin for the EU

Unlikely Resolves by End of 2027

Discussed by: Commentators noting Circle's precedent of launching a distinct EU-compliant euro token

Rather than wait for rule changes, Tether launches a different token designed to stay under the significant-token threshold or structured specifically for MiCA compliance. This would restore EU access without a rule change — but would require holding the 30% (or 60%, if classified significant) bank deposits Tether currently refuses. Ardoino has not said Tether would do this.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

June 2019 – January 2022

Facebook's Libra stablecoin blocked by regulators (2019)

Facebook announced Libra in June 2019 as a global stablecoin backed by a basket of major currencies. Regulators, treasury officials, and central banks pushed back within weeks, objecting to a private currency operating without state oversight.

Then

Facebook rebranded the project as Diem, scaled it back to a dollar-backed token, and sold the assets to Silvergate in January 2022, abandoning issuance.

Now

The episode hardened regulators' resolve to write stablecoin rules before private issuers set their own.

Why this matters now

Shows that stablecoin geography is shaped by regulators as much as issuers — and that a company can walk away from a market only if it can afford to lose it.

June 2024

Tether winds down EURT (2024)

As MiCA's stablecoin rules took effect, Tether announced it would stop issuing its euro-pegged EURT, citing regulatory demands and calling for a 'more risk-averse framework.' It was Tether's first public exit tied to MiCA.

Then

EURT was wound down and Tether concentrated issuance in USDT outside the EU framework.

Now

Established the pattern of Tether exiting markets where it considers rules unsafe rather than complying.

Why this matters now

The EURT wind-down was the opening move in the same standoff; the EU walk-away is Tether drawing the same line at a much larger scale.

July 2024

Circle obtains MiCA authorization in France (2024)

Circle, issuer of USDC, obtained authorization under MiCA from French regulators, enabling it to issue euro- and dollar-pegged tokens inside the EU framework.

Then

Circle positioned itself as the MiCA-compliant alternative in Europe as Tether stayed out.

Now

Showed that the EU market was open to issuers willing to follow the rules.

Why this matters now

Frames the choice Tether rejected: comply with MiCA or cede the EU market to compliant rivals like Circle.