Tether, the world’s largest stablecoin issuer, is working with U.S. lawmakers to influence federal regulations for the stablecoin sector. According to Fox Business reporter Eleanor Terrett, Tether has been in talks with Representatives Bryan Steil and French Hill, who are key figures behind the STABLE Act introduced on February 6. Tether’s CEO, Paolo Ardoino, stated that the company aims to contribute to two additional stablecoin bills proposed by other legislators. “We are not going to just throw in the towel and let Tether die just for the sake of not adapting to U.S. legislation. But there is still a lot of uncertainty over what’s actually going to happen, and we want our voice to be heard in the legislative process.”
Compliance with U.S. regulations would require Tether to maintain one-to-one asset backing for its tokenized fiat equivalents and conduct monthly reserve audits through a U.S.-based accounting firm, as reported by Terrett. Tether’s involvement in the regulatory debate comes amid recent talks between crypto industry executives and the Securities and Exchange Commission (SEC) over broader regulatory concerns. The Trump administration has also encouraged stablecoin issuers to establish operations within the U.S.
Federal Reserve Governor Christopher Waller recently discussed stablecoins, suggesting that U.S. dollar-pegged digital assets could enhance the dollar’s global dominance. “Stablecoins will broaden the reach of the dollar across the globe and make it even more of a reserve currency than it is now,” Waller said in a February 6 interview. Stablecoin issuers have become significant buyers of U.S. government debt, utilizing Treasury securities to overcollateralize their tokens and sustain dollar demand in global markets. However, Waller warned of potential risks, including de-pegging events and sector fragmentation, calling for a balance between innovation and regulatory safeguards.
Stablecoins already play a crucial role in the financial ecosystem by providing a stable store of value for crypto traders, facilitating access to U.S. dollars in high-inflation economies, enabling faster cross-border payments, and showing promising uses in retail transactions. While speaking at the Atlantic Council, Waller referred to stablecoins as “synthetic dollars,” comparing them to commercial bank money and emphasizing their potential to create new payment possibilities. He noted that if stablecoins can foster competition, broaden financial inclusion, reduce transaction costs, and make payments faster and more efficient, then they should be embraced.
Federal Reserve Chair Jerome Powell recently affirmed the central bank’s support for developing a regulatory framework around stablecoins during a Senate hearing on February 11. Powell emphasized the importance of protecting consumers and savers while acknowledging the uncertainty surrounding the future of stablecoins and their potential use by both consumers and businesses.
NEW from me: Offshore stablecoin giant @Tether_to is working with U.S. lawmakers to influence how these fiat-backed currencies are regulated in the U.S. The issuer of the world’s largest stablecoin $USDT has been a controversial figure in U.S. crypto policy circles due to an… — Eleanor Terrett (@EleanorTerrett) February 14, 2025
