XRP has overtaken Tether’s USDt stablecoin to become the third-largest cryptocurrency by market cap. XRP’s market cap reached $138.98 billion on Jan. 3, a surge that coincided with the entry into force of the European Union’s Crypto-Asset Markets Regulation (MiCA), which resulted in a $1.6 billion drop in USDt’s market cap.

The MiCA requires stablecoin issuers to hold full reserves and obtain a license to operate within the EU. This is seen as one of the factors driving XRP’s market momentum.

XRP’s rally was also supported by speculation about a spot XRP exchange-traded fund (ETF). WisdomTree became the fourth company to file a spot XRP ETF application with the U.S. Securities and Exchange Commission.

Tether continues to dominate the stablecoin market with a 67.21% market share. However, the effects of MiCA and the rise of XRP could lead to changes in market dynamics. What do you think about these developments? Share your views in the comments.