This title sounds crazy. However, due to MiCA regulation discussions in Europe, it could have happened. Apparently, USDT and other USD stablecoins will not be banned in the European Union. This proposal was removed last week. However, a EUR 200 million cap on non-euro-backed stablecoins would be back in the EU’s comprehensive digital asset framework...
What does it mean?
The cap would limit transactions using "stablecoins denominated in other currencies", like USD, to EUR 200 million transacted per day. While this amount seems to be huge for you, it is in reality a strong limitation for EU-based crypto-asset service providers, since they transfer more than that every day.
Therefore, these service providers will have to go away from Europe, or replace the USD stablecoins with EUR stablecoins, which are very limited so far.
What could be the consequences on the Crypto market?
If this EUR 200 million cap is voted favorably, it will increase the market volatility, first of all for the top cryptos like Bitcoin (BTC) and Ethereum (ETH), but also and mostly for stablecoins. Nobody knows if it has a chance to be voted on or not, but in case of, a strategy could be to short USDT... You may read this article for further instructions: How To Short Tether (USDT)
Disclaimer: this article does not contain any financial advice. The information is provided for general informational and educational purposes only.
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