- Tether to introduce a GENIUS Act-compliant stablecoin.
- Circle faces increased competition in U.S. market.
- Regulatory changes impact stablecoin strategies in the U.S.
Tether plans to launch a U.S.-specific stablecoin by late 2025 to meet GENIUS Act requirements, posing a challenge to Circle’s USDC.
Tether’s plan for a new stablecoin highlights regulatory compliance’s growing role in crypto markets, prompting immediate reassessment of U.S. market strategies.
The Announcement by Tether
The announcement by Tether outlines a planned U.S.-specific stablecoin to comply with new regulations under the GENIUS Act, confirmed by CEO Paolo Ardoino. The stablecoin aims to enhance U.S. market integration and regulatory compliance. Tether’s new stablecoin will accompany USDT, which continues to focus on global markets while adopting a foreign issuer model in the U.S., said Ardoino. This move is characterized by Tether’s push for increased regulatory alignment and full audits as part of a compliance roadmap.
“The company is aligning its operations with anti-money laundering protocols, conducting full audits, and following a multi-year compliance roadmap to strengthen trust.” — Paolo Ardoino, CEO, Tether
Circle’s Response
Circle CEO Jeremy Allaire responded, stating the GENIUS Act supports Circle’s transparency model, ensuring full reserve backing and public audits. The act firmly establishes a federal framework for stablecoin compliance, indicating increased institutional trust in the sector. This development impacts USDC’s market position in the United States, heightening competitive pressures between stablecoin issuers. Yet, Circle’s existing compliance reflects robust adherence to U.S. regulatory expectations.
Regulatory changes could reshape stablecoin issuer strategies, particularly affecting market shares. Historical parallels observed in similar regulatory shifts reveal potential for further consolidation among crypto assets adhering to emerging compliance norms. This positions Tether and Circle to enhance their institutional relationships and enhance trust in a rapidly evolving regulatory landscape.
