Tether Launches U.S. Stablecoin Amid New Legislation, Aiming to Challenge USDC's $64.7B Market Share

Tether Holdings SA is advancing its strategy to re-enter the U.S. market, with CEO Paolo Ardoino confirming efforts to develop a U.S.-specific stablecoin tailored for institutional clients and cross-border transactions. The move follows the enactment of the U.S. stablecoin legislation, signed into law by President Donald Trump, which Ardoino said aims to "streamline innovation" in digital assets while aligning with regulatory frameworks [1]. Tether, the issuer of the globally dominant USDT stablecoin, emphasized its focus on creating a "high-efficiency" token for payments and interbank settlements, positioning itself to compete in a market currently dominated by Circle’s USDC [2].

The CEO acknowledged Tether’s history of scrutiny, including a 2021 settlement with U.S. regulators over alleged misleading claims and a ban on New York operations. Ardoino noted recent discussions with auditors to address transparency concerns, though the firm has not disclosed audit timelines. Tether’s U.S. expansion also faces indirect risks from its ongoing legal and operational challenges in other markets. For instance, the company has delayed re-entry into the European Union until the Markets in Crypto-Assets (MiCA) regulation "becomes safer for consumers" [3].

Tether’s potential threat to Circle’s USDC is significant, given its $162 billion USDT supply versus USDC’s $64.7 billion. However, Ardoino stressed that Tether has no plans to pursue an initial public offering, unlike Circle, which recently listed on the stock market [4]. Instead, Tether is prioritizing a broader diversification strategy, having invested in over 120 fintech, blockchain, and AI startups globally. These investments aim to strengthen its infrastructure and position Tether as a "strategic shield" for its stablecoin operations while expanding into Web3 innovation [5].

The U.S. market’s regulatory landscape remains a critical factor. While the new legislation offers opportunities for stablecoin adoption, Tether must navigate stringent compliance requirements, including those under the Commodity Futures Trading Commission and state-level oversight. Ardoino highlighted Tether’s technological edge and deep understanding of emerging markets as competitive advantages, particularly in regions where U.S. financial institutions face operational limitations [6].

Analysts note that Tether’s success in the U.S. hinges on its ability to rebuild trust amid past controversies. The firm’s claims of full collateralization—backed by a mix of cash, U.S. Treasury bills, and other assets—remain unverified by independent audits, a gap critics argue undermines market confidence. Meanwhile, the competitive dynamics with Circle and other stablecoin issuers will likely intensify as the sector matures [7].

Tether’s dual strategy—launching a U.S.-focused stablecoin while expanding its venture arm—reflects a calculated response to regulatory and market pressures. The outcome could reshape the stablecoin landscape, balancing innovation with the need for transparency. As the firm navigates these challenges, its actions will be closely watched by regulators, investors, and industry peers.

Source: [1] [Tether CEO Says Stablecoin Issuer Is Making Plans to Enter US] [https://news.bloomberglaw.com/banking-law/tether-ceo-says-stablecoin-issuer-is-making-plans-to-enter-us]

[2] [Trump's signature on stablecoin law kicks off flurry of activity] [https://coingeek.com/trump-signature-on-stablecoin-law-kicks-off-flurry-of-activity/]

[3] [Tether Expands Beyond Stablecoins as Profit Fuels 120 ...] [https://beincrypto.com/paolo-ardoino-tether-investments/]

[4] [Tether's Diversification Strategy Emerges as Strategic ...] [https://www.xt.com/en/blog/post/tethers-diversification-strategy-emerges-as-strategic-shield-for-usdt]

[5] [Tether's Paolo Ardoino Confirms 120+ Investments Amid USDT Supply Surge] [https://coinstats.app/news/4f2a30d6d57f0e8468371b6d8fad7ab63ce8e7bfc13ed468ccb2204aa0c7cffa_Tethers-Paolo-Ardoino-Confirms-120-Investments-Amid-USDT-Supply-Surge]