TL;DR
- Tether has responded to JPMorgan analysts, who suggested the company might have to sell Bitcoin to comply with new US stablecoin regulations.
- JPMorgan analysts based their comments on the GENIUS Act and STABLE Act bills, which propose strict reserve requirements for stablecoin issuers.
- Tether defended its position, highlighting its financial strength and willingness to adapt to regulations, although they have not been approved yet.
Tether has firmly responded to JPMorgan analysts who suggested the company might be forced to sell part of its Bitcoin reserves to comply with proposed US stablecoin regulations.
On February 12, a team of analysts led by Nikolaos Panigirtzoglou released a report stating that, under the proposed laws, Tether could need to offload some non-compliant assets, such as Bitcoin, to meet regulatory requirements.
The report is based on the currently discussed bills, the GENIUS Act and the STABLE Act, which establish stricter regulations on stablecoins. According to JPMorgan analysts, the STABLE Act, in particular, requires stablecoin issuers to hold reserves only in assets considered safe, such as US Treasury bonds or short-term repos. This would imply the sale of assets like Bitcoin to meet the standards of the new legislation.
Paolo Ardoino: JPMorgan Doesn’t Understand Bitcoin
Tether has vehemently rejected these claims. A company spokesperson stated that the analysts do not understand either Bitcoin or the company structure, emphasizing that the laws are not yet finalized. Furthermore, the firm highlighted that it is closely monitoring the evolution of the regulations and maintaining an active dialogue with local regulators to ensure its operations comply with the regulations.
Tether Demonstrates its Financial Strength
Additionally, the spokesperson emphasized Tether’s financial strength, mentioning that the company holds over $20 billion in liquid assets, along with more than $1.2 billion in quarterly profits through US Treasury bonds. This highlights that the company has sufficient resources to adapt to any regulatory changes, even in the worst-case scenario.
The debate over the proposed stablecoin regulations remains a hot topic in the crypto world. While the laws have not yet been approved, their potential impact on companies in the sector could alter the functioning of the crypto industry in the coming years
