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Tether, the world’s most traded cryptocurrency, is considering offering a US-only stablecoin if Donald Trump’s administration introduces regulations to encourage new market entrants.
Paolo Ardoino, the group’s chief executive, told the Financial Times it was involved in discussions about US rules on stablecoins — a type of cryptocurrency pegged to a real-world asset such as the dollar — and that the administration saw them as “an important instrument for the United States”.
Depending on the outcome, Tether could create a token just for the US market Ardoino said. At the moment $144bn of tether tokens are in circulation but the company does not accept customers in the US.
Tether is widely used in crypto markets, but the Financial Times has previously reported that, according to US enforcement officials, prosecutors and information from indictments, it is the go-to cryptocurrency for international criminals. Tether has strongly defended itself against accusations that it facilitates criminal activity.
Since Trump’s return to the White House in January, he has promised to make the US “the crypto capital of the planet” and called for new rules for stablecoins to be ready by August.
At the same time, the main US securities regulator has ended or halted most of the cases it was pursuing against crypto companies. Ardoino said the change in climate had given him the confidence to visit the US for the first time.
The El Salvador-based group is a big buyer of US government debt. It invests most of the reserves it holds against its coins in US Treasuries and keeps the interest paid out on the bonds. High US interest rates boosted its net profits last year to $13bn, although its results were unaudited.
Ardoino said that, if the new rules “make [US] domestic stablecoins competitive, there could be an interest from Tether to create a domestic stablecoin in the US,” adding that it would be “basically a settlement currency”.
Stablecoins are meant to act as a form of digital cash, keeping a steady value but outside the regulated banking system. The regulations being considered in Washington include plans that would force overseas issuers with cryptocurrencies trading in the US to comply with the country’s law enforcement. Ardoino said “that is something that we [already] do . . . voluntarily”.
“We are the only ones that on-board the FBI, on-board the US Secret Services. We work directly with the [Department of Justice] and we don’t wait for court orders to act, but we actually have a direct connection with the law enforcement,” he said.
Tether’s critics have long been sceptical about its reserves. In the past few years these have been managed by the US financial services firm Cantor Fitzgerald, which was run for more than three decades by Howard Lutnick, the US commerce secretary.
Last month, it hired a chief financial officer to steer Tether towards a full financial audit, something it has been promising for years. Ardoino said the company was in talks with the Big Four accounting firms.
In the past, it had been hard to persuade large accounting firms to engage with Tether about auditing, he said, but their stance had started to change since the new administration.
“It’s just two months,” he said, “but it’s crazy.”
