Tether, the well-known issuer of the stablecoin USDT, has reached a new milestone by minting over 160 billion tokens. This news comes amid rising scrutiny from U.S. regulators and the international community.
Regulatory Issues for Tether
With the latest issuance of USDT reaching 2 billion tokens, Tether is facing critical attention regarding its reserve practices and its regulatory future in the U.S. Despite claims of backing in U.S. Treasuries and gold, critics argue that the company has never undergone a full third-party audit of its reserves, casting doubt on the transparency and stability of the token.
The New GENIUS Act Legislation
A new threat is emerging for Tether — the GENIUS Act. If passed, this legislation could restrict the use of USDT in the U.S. and force the company to undergo rigorous reserve audits, something it has avoided in the past. While Tether has previously weathered EU regulatory pressure, losing access to the U.S. market could have significant negative consequences.
Future of Tether in the Stablecoin Market
Despite its global reach, Tether’s uncertain regulatory standing continues to raise questions about its long-term role in the financial system. As U.S. lawmakers debate the future of stablecoins, the spotlight on Tether is only getting brighter.
Tether stands at a crossroads: on one side, it opts for aggressive minting of its cryptocurrency, while on the other, it faces stringent regulations and options that could fundamentally change its operating model, especially in the vital U.S. market.
