Ripple CEO Brad Garlinghouse recently expressed his belief that the United States government is targeting Tether, the world’s largest stablecoin issuer by market capitalization.
Speaking on the World Class podcast, Garlinghouse stated, “The U.S. government is going after Tether, that is clear to me.” While acknowledging Tether’s importance within the cryptocurrency ecosystem, he admitted uncertainty about the potential impact of U.S. regulatory action against the company.
TLDR
- Ripple CEO Brad Garlinghouse believes the U.S. government is targeting Tether, the largest stablecoin issuer by market capitalization.
- Garlinghouse views Tether as an essential part of the crypto ecosystem but is uncertain about the impact of potential U.S. regulatory action against the company.
- Tether has faced scrutiny over its transparency regarding the reserves backing its USDT stablecoin and has been investigated for alleged misconduct.
- Tether CEO Paolo Ardoino criticized Garlinghouse’s statements, calling him an “uninformed CEO” and highlighting Ripple’s own legal issues with the SEC.
- Ripple plans to launch its own stablecoin in 2024, which could compete with Tether’s USDT.
Tether, which issues the USDT stablecoin, has faced ongoing scrutiny regarding its transparency and the reserves backing its token.
The company has been criticized for its lack of clarity surrounding its holdings and has been investigated for alleged misconduct. In October 2021, Tether paid a $41 million fine to the Commodity Futures Trading Commission for misrepresenting its reserve holdings.
Garlinghouse’s comments come as Ripple, the company behind the XRP cryptocurrency, prepares to launch its own stablecoin in 2024.
The Ripple CEO’s statements have drawn criticism from Tether CEO Paolo Ardoino, who took to social media to call Garlinghouse an “uninformed CEO.” Ardoino pointed out that Ripple itself is currently under investigation by the U.S. Securities and Exchange Commission (SEC) and suggested that Garlinghouse’s comments were motivated by Ripple’s forthcoming stablecoin, which could compete with USDT.
An uniformed CEO, leading a company being investigated by the SEC, launching a competitive stablecoin (cui prodest), is being reported spreading fear about USDt.
Let me give you an update on Tether USDt ecosystem safety.
USDt is the most used stablecoin in the world, with…
— Paolo Ardoino ???? (@paoloardoino) May 13, 2024
Ardoino defended Tether’s compliance efforts, highlighting the company’s collaboration with blockchain analytics firm Chainalysis and law enforcement agencies worldwide.
He emphasized that Tether leverages blockchain technology’s transparency to meet regulatory requirements.
As the cryptocurrency industry continues to evolve, the role of stablecoins and their regulation remains a topic of ongoing discussion. The potential impact of U.S. regulatory action against Tether is difficult to predict, given the company’s significant market presence.
However, the emergence of new stablecoin competitors, such as Ripple’s upcoming offering, may reshape the landscape and provide alternatives for investors and users.
