Quick overview

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European traders are adjusting their cryptocurrency strategies amid a sharp decline in the US dollar.  The U.S. dollar declined approximately 11% against major currencies in the first half of 2025, representing its most significant mid-year drop since the 1970s.

This weakness has led traders in the euro zone to reconsider how they structure their crypto holdings. Even as cryptocurrency prices stay stable in dollar terms, converting back to euros has reduced returns, prompting many to transact and hold assets in their local currency instead of relying on US dollar settlements.

 

The shift toward euro-denominated trading is clear on European exchanges, where liquidity in ETH/EUR pairs has more than doubled in the past year.

Meanwhile, trading in USD Tether pairs has been declining. This trend reflects a strategic choice to reduce exposure to volatile exchange rates rather than engage in speculative currency plays. The benefits of this approach are straightforward: by maintaining transactions and holdings in euros, investors can lower potential losses from a depreciating dollar and secure more predictable returns in their local currency.

Additionally, demand for euro-pegged stablecoins is increasing, even though their market share still trails behind that of U.S. dollar-pegged stablecoins

. Coins such as EURC and EURS have experienced double-digit growth in market capitalization this year, with the total euro-stablecoin supply nearing $600 million. For institutional investors and businesses, these euro-backed assets offer a practical on-chain alternative to U.S. dollar exposure. If current trends continue, euro-stablecoin adoption could surpass $1 billion before 2026.