Circle CEO Calls for U.S. Oversight of Stablecoins, Tether Silent

Circle's CEO, Jeremy Allaire, has called for increased oversight of dollar-pegged stablecoins, urging issuers to register in the U.S. As stablecoin legislation looms, Allaire expressed concerns about non-U.S.-based issuers operating without adhering to U.S. laws. In an interview, he stated, "It shouldn't be a free pass... Where you can just ignore U.S. law and go do whatever the hell you want wherever and sell into the United States."

Allaire's comments come amidst a flurry of activity in the stablecoin space. Senator Bill Hagerty has proposed a framework for stablecoin issuers, while former President Donald Trump had pledged to make the U.S. a crypto hub. Circle's stance could potentially impact its main rival, Tether, which recently relocated its headquarters to Bitcoin-friendly El Salvador. Allaire emphasized the need for consumer protection and financial integrity, stating, "Whether you're an offshore company or based in Hong Kong, if you want to offer your dollar stablecoin in the U.S., you should need to register in the U.S. just like we have to go register everywhere else."

Tether's CEO, Paolo Ardoino, did not directly address Allaire's call but hinted at competitive pressures in a Feb. 25 post on X, suggesting that some competitors were working to undermine Tether's business. Ardoino wrote, "While our competitors' business model should be to build a better product and even bigger distribution network, their real intent is 'Kill Tether'. Every single business or political meeting that they have culminates with this intent."

The debate over stablecoin regulation extends beyond the U.S. In July 2024, analysts at blockchain research firm Kaiko suggested that Europe's Markets in Crypto-Assets Regulation (MiCA) prompted a rush among issuers to comply, benefiting Circle at the expense of its rivals. Ardoino criticized MiCA, arguing that its requirement for stablecoin issuers to hold at least 60% of reserves in E.U. bank accounts poses financial risks, as deposits exceeding €100,000 are not insured.