Crypto MiCA Regulation Goes Into Effect in Europe

The final phase of the European Union’s Markets in Crypto-Assets (MiCA) regulation came into effect on December 30, introducing comprehensive licensing and compliance requirements for crypto-asset service providers (CASPs) and stablecoin issuers.

Stablecoins are classified into two categories under MiCA: asset-referenced tokens (ARTs) and e-money tokens (EMTs), with issuers required to secure EU-based licenses and maintain significant reserves, such as 60% of holdings for larger players like Tether.

USDC, already compliant with MiCA, is set for increased institutional adoption, while Tether has yet to align with the regulation, prompting Coinbase Europe to preemptively delist USDT. Critics, including Agne Linge of WeFi, argue that MiCA’s high compliance costs could force smaller players out of the EU.

On X, crypto investor Fefe Demeny highlighted USDC’s potential to leverage its regulatory edge, noting that MiCA’s transition period of up to 18 months offers flexibility for CASPs and issuers. Major platforms like Binance continue to support USDT, awaiting further regulatory clarity.

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Tether Moves $780M in Bitcoin to Reserve

Tether has transferred nearly $780 million worth of Bitcoin into its reserves, marking its largest move since March 2024. The addition of approximately 8,404 BTC increases its holdings to 83,759 BTC, valued at just under $7.75 billion. This aligns with Tether’s May 2023 pledge to allocate up to 15% of its net realized profits toward Bitcoin purchases.

With Bitcoin’s price doubling in 2024, corporate treasuries, including Tether, have seen renewed interest in crypto holdings as strategic assets. Tether’s Bitcoin reserves remain second only to Block.one and are among the largest holdings by any private or public company.

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Franklin Templeton’s 2025 Crypto Predictions

Franklin Templeton forecasts pivotal developments in crypto for 2025, including countries adopting Bitcoin reserves and broader ETF approvals. The asset manager expects the US to establish favorable regulations under its new administration, positioning itself as a global hub for crypto innovation. Key predictions also include an increased adoption of tokenized securities.

Franklin Templeton highlights potential growth in TradFi-crypto collaborations, anticipating more financial institutions issuing their own stablecoins under an expected regulatory framework. Countries like Japan, Russia, and Poland are cited as likely adopters of strategic Bitcoin treasuries, following ongoing discussions.

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Montenegro Extradites Do Kwon to the US

Montenegro extradited Terraform Labs co-founder Do Kwon to the US on December 31, concluding months of legal proceedings. The extradition, facilitated by Interpol and Montenegro’s Special Police Unit, follows competing requests from the US and South Korea. Kwon faces charges in the US for securities fraud, money laundering, and electronic fraud tied to the collapse of Terra/Luna.

The decision aligns with Montenegro’s Ministry of Justice’s assessment of the severity and jurisdiction of the crimes. US authorities, including the FBI, received custody of Kwon at Podgorica Airport. The extradition marks a pivotal moment in the ongoing legal fallout from one of the crypto industry's most high-profile collapses.

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Data of the Day

Venture capital investments in blockchain startups reached $13.6 billion in 2024, up from $10.1 billion in 2023, reflecting growing confidence in the sector. This rebound remains below the $32.4 billion peak of 2021 but signals recovery caused by declining interest rates and increased regulatory clarity.

The most notable crypto raises in 2024 include $225 million for Monad Labs’ smart contract network and $100 million for Berachain’s modular blockchain development. Analysts predict crypto VC funding will surpass $18 billion in 2025, powered by greater investor appetite.

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More Breaking News

• NFT sales volume for 2024 hit $8.8 billion, slightly surpassing 2023 figures, with Ethereum and Bitcoin leading at $3.1 billion each.
• MicroStrategy stock fell to $293.59, down 46% from its November peak, despite recent Bitcoin purchases and Nasdaq inclusion.
• The trial between the CFTC and Gemini Trust Company has been rescheduled to Jan. 21, moving into the new presidential administration.
• Binance Labs announced a rebrand and plans to expand investment in blockchain, AI, and biotech, including secondary market and OTC deals in 2025.
• The Blockchain Bandit hacker moved $172M in Ether to a multisignature wallet after two years of inactivity, per investigator ZachXBT.

For the latest updates on digital asset markets, follow us on X @Datawalletcom.