The US dollar has been on its steepest slide in decades, and it’s starting to reshape the way European investors approach the digital asset market.
In the first half of 2025 alone, the greenback fell roughly 11% against other major currencies, marking its worst mid-year drop since the early 1970s.
This downturn has left euro-based traders facing an invisible cost — even when crypto prices in dollars remain stable, currency conversion back to euros can erode returns. The shift has encouraged more market participants to transact in their own currency rather than relying on USD settlements.
Growing Preference for Euro-Denominated Trading
On European exchanges, euro-quoted crypto pairs are gaining traction. Data from Kaiko shows liquidity in ETH/EUR markets has doubled in the past year, while trading in USD Tether pairs is gradually declining. For many investors, this change is about reducing exposure to volatile exchange rates rather than making a speculative currency bet.
The strategy offers a simple advantage: keeping transactions and holdings in euros avoids losses caused by a weakening dollar, making profits more predictable in home currency terms.
Euro-Pegged Stablecoins on the Rise
Alongside the trading shift, demand for euro-backed stablecoins has been accelerating. Although their market share remains small compared to USD-pegged coins, growth has been noticeable. Circle’s EURC and Stasis’ EURS have posted double-digit gains in market cap this year, lifting the total euro-stablecoin supply toward the $600 million mark.
For businesses and institutional desks, these assets provide a practical way to hold value on-chain without introducing dollar exposure. If current currency trends persist, euro-stablecoin adoption could expand well past $1 billion before 2026.
Dollar Dominance Faces Subtle Challenges
While the euro is gaining ground, analysts say the dollar’s role in crypto is far from over. USD-backed stablecoins still dominate global liquidity, representing the majority of the $250 billion stablecoin market. Their scale, integration into exchanges, and backing by US treasuries make them deeply embedded in the ecosystem.
Still, the steady rise of euro-based assets hints at a more diversified future. As Europe builds out its own infrastructure and traders seek to limit currency risk, the balance of power in crypto’s monetary base could slowly start to shift.
The information provided in this article is for informational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/dollar-weakness-pushes-european-traders-to-rethink-crypto-holdings/