Tether CEO Dismisses J.P. Morgan's Compliance Concerns, Market Unfazed

Tether's CEO, Paolo Ardoino, has dismissed a recent report by J.P. Morgan that suggests the company could face compliance risks in the U.S. if the current stablecoin bills are adopted. Ardoino described J.P. Morgan as 'alty,' asserting that Tether is highly liquid with over $20 billion in assets and can meet the demands of the proposed bills.

J.P. Morgan's analysis, as reported by The Block, indicates that only 66%-83% of Tether's reserve assets comply with the standards set by the STABLE Act and the GENIUS Act, two stablecoin bills proposed by U.S. policymakers. The report suggests that Tether may need to sell some of its non-compliant reserve assets to meet the regulatory threshold, which could impact Bitcoin, precious metals, and secured loans.

Market analysts have noted a decline in Tether's compliance ratio since last quarter, potentially complicating matters for the company. Several crypto exchanges in the E.U. have delisted Tether's USDT, allowing Circle's USDC to gain market share. However, USDT's market size has not been significantly affected due to its dominance in the U.S. and other markets, with its market cap recently reaching an all-time high of $141 billion.

Some market analysts, like Alex Kruger, have warned that if Tether fails to comply with U.S. stablecoin provisions, it could have negative implications for the entire market. Ardoino has stated that more clarity on the bills and consultations will be known in the coming weeks.