XRP Price Set to Gain as Ripple’s RLUSD Taps Mica-Driven EU Market Gap

• EU’s MiCA regulations trigger Tether (USDT) withdrawal from major European crypto exchanges.
• Ripple’s MiCA-compliant RLUSD stablecoin is positioned to fill the void left by USDT in Europe.
• MiCA’s impact could boost XRP as RLUSD gains traction on the XRP Ledger and Ethereum.

The European Union’s new MiCA regulations have sent shockwaves through the crypto ecosystem. These rules aim to bring stability to stablecoins, but the fallout has been swift and disruptive. Tether, the issuer of USDT, the most widely used stablecoin globally, has started withdrawing its flagship product from major European crypto exchanges. 

This strategic retreat by Tether, driven by what it evidently sees as challenging regulatory hurdles under MiCA, is creating a noticeable vacuum in the continent’s digital asset markets. Observers note that USDT liquidity has begun to tighten on these platforms, leaving traders and protocols scrambling for viable alternatives. In this turbulent environment, Ripple’s RLUSD stablecoin appears to be quietly gaining ground, set to reshape the competitive field.

MiCA’s Strict Mandates Drive Tether From European Market

The MiCA regulations don’t pull any punches, imposing stringent new limits and requirements on stablecoin issuers operating within the EU. Key rules include a prohibition on paying interest on stablecoin balances, a mandate for issuers to hold at least 60% of their reserves in cash, and strict caps on daily issuance and redemption volumes. Furthermore, stablecoin operations and compliance frameworks must align with those of EU-regulated banking institutions. 

Faced with these new operational demands, Tether, unwilling to restructure its massive $150 billion operation, chose to exit rather than comply. Consequently, top exchanges in Europe delisted USDT, leaving traders with fewer options and thinning liquidity across key trading pairs.

While Tether steps back, Circle has been actively pushing its MiCA-compliant stablecoins, USDC and its euro-pegged counterpart EURC, further into the European spotlight. But combined euro-denominated stablecoins still hover around just $250 million in market cap. USDC fares better at $61 billion, yet both remain far behind USDT’s dominant position. That gap presents a significant opportunity one Ripple seems prepared to seize.

Related: Ripple Joins Forces with Zand Bank and Mamo to Transform Cross-Border Payments in UAE

Ripple’s RLUSD Emerges as Key MiCA-Compliant Contender

Ripple’s stablecoin, RLUSD, entered the market in December with full MiCA compliance baked in. It operates on both the XRP Ledger and Ethereum, offering flexibility that few can match. Unlike other U.S.-centric stablecoin providers, Ripple has cultivated deep institutional ties globally. This global strategy is now paying dividends.

Significantly, Ripple has also built relationships with regulators over the years. This allows it to scale quickly without legal friction. With a proven blockchain infrastructure and a focus on regulatory cooperation, RLUSD stands ready to capitalize on the vacuum left by USDT.

Market Realignment: Potential Impacts on Bitcoin and XRP

The instability from Tether’s exit could extend beyond stablecoins. Bitcoin often relies on stablecoin liquidity for trading pairs. Thinner markets may lead to increased volatility, especially in Europe. Moreover, if traders shift away from USDT, Bitcoin could experience sharper moves as liquidity dries up.

Related: Ripple’s RLUSD vs Tether’s USDT: GENIUS Act May Reshape Stablecoin Ranks

However, XRP may be the unexpected winner in this realignment. As RLUSD gains traction, demand for XRP could rise, especially on the XRP Ledger. If Ripple captures even a fraction of Tether’s displaced volume, XRP could benefit significantly—potentially setting the stage for a breakout before year-end.