tl;dr
CEO Brian Armstrong stated that Coinbase would delist Tether's USDT stablecoin if new legislation compelled them to do so. Current attempts to revise US crypto legislation could impact Tether, potentially disrupting its operations. Armstrong mentioned potential legislative changes that could challen...
Coinbase CEO Brian Armstrong has expressed concerns about the potential delisting of Tether's USDT stablecoin due to US legislative changes. He stated that Coinbase would delist Tether's USDT stablecoin if compelled by new legislation. This comes amidst attempts to revise US crypto legislation, which could have a significant impact on Tether, potentially disrupting its operations.
Armstrong mentioned potential legislative changes that could challenge Tether, including requirements for stablecoin issuers to hold reserves in US Treasury bonds and undergo regular audits. He also indicated that Coinbase is prepared to cooperate with this framework, even if it means sidelining Tether.
This reflects the evolving regulatory landscape for cryptocurrencies in the US, with a focus on potential impacts on Tether and Coinbase. Armstrong's comments come in the wake of the US crypto space agitating for a comprehensive new regulatory framework, which would almost certainly impact Tether.
A similar effort in the US could seriously disrupt Tether's operations, given the minor setback it suffered from the EU’s MiCA legislation. Armstrong predicts that a similar issue may happen with Tether in the future.
Despite the current positive regulatory changes under the new government, enforcement actions are still possible, especially for non-US crypto entities. The potential imposition of restrictions on Tether by the US Senate through two bills has been mentioned by Armstrong, although neither of them have advanced yet. Therefore, the likelihood of these regulations passing remains uncertain.
While Tether recently moved to El Salvador, it still heavily relies on the US market. Coinbase's readiness to comply with potential regulatory changes signals the significant impact this could have on Tether and the stablecoin industry as a whole.
Armstrong's stance, coupled with Coinbase's position as a major shareholder in Circle, a stablecoin that directly challenged Tether’s European market dominance, suggests that the stablecoin industry, valued at $218.7 billion, might witness significant shakeups, especially with the US pushing to maintain the dominance of its dollar.