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Tether’s market cap sheds $1.4b as MiCA activates

Tether’s U.S. dollar stablecoin witnessed its biggest downturn since FTX collapsed during the sluggish 2022 crypto market period. On-chain data showed that Tether’s stablecoin ( USDT ) lost approximately 1.2% of its market cap this week as EU digital asset regulations took full effect on Dec. 30. The token’s market cap fell to $137 billion from its December peak of $140 billion, fueling speculation about Tether’s future and potential USDT volatility. Concerns arose that USDT’s operator might exit the European Union now that new laws have been enacted. However, social media sentiment was countered by industry leaders and observers who pointed to data affirming USDT’s resilience outside the EU. You might also like: Tether adds $700m Bitcoin to reserve address Nothing burger Experts and analysts dismissed rumors that the EU’s Markets in Crypto-Assets Regulation would disrupt USDT’s business. Karen Tang, Orderly Network’s head of APAC partnerships, and social media analyst Axel Bitblaze, noted that Asian and U.S. markets maintain USDT’s dominance. About 80% of USDT’s trading volume occurs in Asia, according to Bitblaze. Tang argued that MiCA regulations are more likely to hinder the EU itself, slowing digital asset growth due to “convoluted overregulation.” 4/ But Axel, what about USDT trading volume and the depeg? USDT is the largest stablecoin, with a market cap of $138.5B and a daily trading volume of $44B As of today, 80% of USDT`s trading volume comes from Asia, so the EU delisting won’t have any severe impact. pic.twitter.com/NjxB2iVLhe — Axel Bitblaze ???? (@Axel_bitblaze69) December 29, 2024 Tether plots MiCA compliance Speculation about USDT’s future in the EU intensified in late 2024 after Coinbase and several EU-based exchanges delisted USDT, citing MiCA compliance concerns. While stablecoin rules took effect in July, the full MiCA framework came into force at the end of the year. MiCA requires stablecoin operators to hold certain licenses for e-money tokens and trading asset-referenced tokens, like USDT. So far, Circle ( USDC ) is the first and only major stablecoin issuer to obtain a MiCA license. Tether invested in EU-based companies such as StablR and Quantoz to prepare for regulatory inclusion. CEO Paolo Ardoino has reiterated that the company has no intention of abandoning the EU. While USDT cannot currently be traded on MiCA-compliant exchanges, traders can still store the stablecoin in non-custodial wallets as an interim solution. Read more: Morgan Stanley’s E-Trade ponders crypto services CoinTurk News

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2 cryptocurrencies to reach a $200 billion market cap in Q1 2025

The cryptocurrency market kicked off 2025 on a high note, with Bitcoin ( BTC ) reclaiming levels above $96,000, sparking renewed investor optimism. As attention broadens beyond Bitcoin, altcoins like XRP and Solana ( SOL ) are gaining traction, driven by strong fundamentals and favorable regulatory expectations. These assets are steadily advancing toward significant milestones, with both poised to potentially achieve a $200 billion market cap by the end of Q1 2025 XRP XRP, currently priced at $2.41 with a market capitalization of $138.27 billion, is drawing significant attention from traders and investors, with many taking long positions as the cryptocurrency shows clear signs of bullish momentum. XRP price and market cap. Source: CoinMarketCap This optimism is rooted in a combination of legal, regulatory, and ecosystem developments that are expected to drive significant price growth. A major catalyst for this outlook is the anticipated resolution of Ripple’s longstanding legal battle with the SEC. With former President Donald Trump nominating Paul Atkins, a pro-crypto advocate, as the incoming SEC Chair, the regulatory environment is expected to shift favorably for Ripple. With the SEC’s appeal set for January 15, 2025, just days before Trump’s inauguration, the market is hopeful that Ripple will secure a favorable outcome. A resolution could pave the way for regulatory clarity, including the potential approval of a spot ETF for XRP, which analysts predict would drive institutional inflows. Adding to the bullish case is Ripple’s ecosystem expansion, highlighted by the regulatory approval of its RLUSD stablecoin in December 2024. Derivatives data from CoinGlass further supports the bullish narrative, with open interest climbing 18.9% to $2.51 billion and options volume spiking by 201.26%. Notably, the Binance long-to-short ratio stands at 2.18, indicating that traders overwhelmingly favor long positions, reflecting optimism for continued price growth. XRP Derivatives data. Source: CoinGlass As macroeconomic stability improves and Ripple’s legal and regulatory hurdles are cleared, the convergence of these factors could propel XRP’s market cap to $200 billion, translating to a price of $3.50 to $4, by the end of Q1 2025. Solana (SOL) Solana , currently valued at $208.47 with a $100.65 billion market cap, has a clear path to doubling its valuation and reaching $200 billion in Q1 2025, driven by key market catalysts and growing institutional interest. Solana price and market cap. Source: CoinMarketCap The most significant driver is the anticipated approval of spot Solana ETFs, with major players like VanEck, 21Shares, and Bitwise already filing applications. Bettors on Polymarket currently price in a 78% probability of SEC approval in 2025. Derivatives data from CoinGlass also paints a bullish picture for Solana. Open interest has risen 11.38% to $5.25 billion, with options volume soaring by 288.62%. The Binance long-to-short ratio of 2.58 further supports growing confidence among traders in Solana’s upward trajectory. Solana Derivatives data. Source: CoinGlass Meanwhile, its Total Value Locked (TVL) has surged to $9.13 billion, reflecting strong adoption in DeFi , NFTs , and gaming. While short-term risks persist, such as PumpFun’s recent deposit to Kraken , which raises concerns about potential selling pressure, Solana’s strong institutional partnerships provide a bullish counterbalance. Collaborations with Franklin Templeton, which launched an SEC-compliant money market fund on Solana, and Société Générale, which deployed a MiCA-compliant stablecoin, further highlight the network’s growing appeal to traditional financial institutions. The convergence of these factors could push Solana’s market cap to $200 billion, translating to a price of approximately $415 to $420 by the end of Q1 2025. While short-term risks, such as potential selling pressure, persist, the broader market outlook for these altcoins remains overwhelmingly positive. With robust derivatives data and increasing adoption, both XRP and Solana are well-positioned to capitalize on the momentum generated by a bullish start to 2025. These factors collectively make them key assets to watch as they edge closer to this significant milestone. Featured image via Shutterstock The post 2 cryptocurrencies to reach a $200 billion market cap in Q1 2025 appeared first on Finbold . CoinTurk News