Tether Addresses MiCA Complaince by Investing in Stablecoin Issuer StablR

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As a seasoned crypto investor with over a decade of experience navigating the ever-evolving landscape of digital assets, I find Tether’s recent strategic investment in StablR an astute move. Having witnessed firsthand the rapid expansion and consolidation of the stablecoin market, I can appreciate the strategic importance of maintaining a strong presence in key regions like Europe.

As Europe’s Markets in Crypto Assets (MiCA) regulations are set to take place by the end of the year, Tether’s USDT influence has been relatively low. Yet, strategically, Tether chose to invest in a European stablecoin company named StablR.

In a new development, the Malta-based stablecoin issuer StablR is now utilizing Tether’s tokenization platform Hadron for its two projects: the euro-backed StablR Euro (EURR) and the USD-pegged StablR USD (USDR). This partnership with Tether means that these StablR stablecoins will benefit from Hadron’s suite of tools, including those for compliance, anti-money laundering (AML) checks, know-your-customer (KYC), risk management, and more.

In July of this year, StablR obtained an electronic money institution license for their stablecoins in Malta. The European market for stablecoins has experienced rapid advancements, as the European Markets in Crypto-Assets Regulation (MiCA) is slated to be fully implemented on December 30.

Information from Crypto.com indicates that the market for stablecoins tied to the euro stands at approximately $367 million. The Stasis Euro (EURS) and Euro Coin (EURC), two prominent players in this sector, have market capitalizations of around $130 million and $90 million each. As this market continues to expand, Tether is eager to increase its presence. Regarding these advancements, Tether CEO Paolo Ardoino commented:

The European market for stablecoins is quickly advancing and shows great potential for more expansion, following larger industry patterns. We at Tether are pleased to back projects such as StablR, which share our goal of promoting compliance, advancement, and accessibility within the European stablecoin sector.

The companies declined to disclose the exact amount invested or the valuation. Nevertheless, a representative from Tether announced that they now own a substantial stake in StablR.

Tether Strengthens EU Presence with Strategic Investment

Tether is persisting in fortifying its role within the European Union by making a new investment in StablR. This action follows Tether’s tactic of supporting up-and-coming companies and offering services through its tokenization platform, Hadron. As the EU’s Markets in Crypto-Assets (MiCA) legislation is set to be enforced later this year, Tether’s strategy aligns with this regulatory environment.

The investment comes after Tether’s decision to shut down its own euro-pegged stablecoin last month. The company has also invested in Quantoz, a Netherlands-regulated payment firm and stablecoin issuer.

Tether has frequently spoken against MiCA, specifically objecting to the rule that demands large stablecoin issuers keep a substantial part of their collateral in bank deposits. Instead, Tether stores over 83% of its USDT reserves in U.S. government bonds, repurchase agreements, and money market funds.

In July, StablR obtained a permit to function as an Electronic Money Institution. This allows them to introduce a compliant stablecoin with upcoming EU regulations on stablecoins. StablR’s founder and CEO, Gijs op de Weegh, highlighted that the company is dedicated to offering exceptional compliance, liquidity, and flexibility for both institutions and merchants.

With the help of our recent investors, we are indeed making good on our promise. This marks a fresh chapter for stablecoins, and StablR is undeniably leading the way,” Weegh expressed.

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2024-12-17 18:27