coindesk.com
The world's leading stablecoin by volume, Tether's $USDT, could be shoved out of the U.S. markets if the company doesn't revamp dramatically in the next two years.
Despite assurances last year from CEO Paolo Ardoino that the stablecoin giant would achieve U.S. compliance for $USDT, the company hasn't yet revealed a sharp turn toward the demands of the Guiding and Establishing National Innovation for U.S. Stablecoins ($GENIUS) Act, which became law one year ago.
With that consequential anniversary of President Donald Trump's signing of the law passing on Saturday, the industry has marked a surge in stablecoin interest and issuance, plus a wide array of crypto and traditional financial firms pursuing U.S. trust bank charters to ease their stablecoin pathways. But the one-year mark was also supposed to be a deadline for federal financial regulators to have rules in place implementing $GENIUS, and they've so far fallen short. That could be problematic as experts and industry insiders still reveal some disagreements over how the law should be interpreted.
At this point, it's still two firms battling for market dominance, with a few others — including the issuer tied to President Donald Trump, World Liberty Financial — fighting it out for a very distant third place. Tether's chief rival, U.S.-based Circle, has made more of an apparent effort to pre-comply with what U.S. regulations will soon require.
Meanwhile, Tether's most recent disclosures suggest as much as a quarter of $USDT's reserves — the stockpile meant to ensure that those redeeming their coins will always be able to — were still plugged into assets that won't meet $GENIUS Act standards, such as precious metals, lending and bitcoin BTC$64,348.58 holdings. $GENIUS requires that issuers are fully reserved in the most highly liquid and reliable assets — essentially cash and U.S. Treasuries.
"Tether will comply with the $GENIUS Act," Ardoino told CoinDesk at the White House, in the moments after Trump signed $GENIUS a year ago. While the CEO indicated then that his company would pursue a separate U.S.-specific token, he said that $USDT would also be managed to meet the law's foreign-issuer standards.
When asked multiple times for an update on its compliance stance in recent days, representatives of El Salvador-based Tether didn't offer a response.
The biggest U.S. exchange is Coinbase, but the company declined to discuss its stablecoin listing plans under $GENIUS.
The exchange and much of the rest of the crypto industry has more recently shifted policy attention toward a different effort of Congress: the Digital Asset Market Clarity Act. The sector's lobbyists had aimed for a one-two punch with $GENIUS and Clarity, and they'd succeeded last year in getting the stablecoin bill passed into law.
But that first major crypto law was meant to complement a wider-reaching regulation of U.S. crypto markets under the Clarity Act, which is still languishing in the final weeks of its potential 2026 congressional window. It remains unclear at the first anniversary of the $GENIUS Act whether its companion will join it on the books. And if it does, it's likely to include some provisions that overhaul some of $GENIUS's language.
Either way, Tether, Circle and the rest of the stablecoin sector are on track to be federally regulated in the coming months under the new law, and how those regulations are navigated may upend which firms play a leading role.