Coinbase CEO Signals Potential USDT Delisting Amid Regulatory Compliance Demands
New Stablecoin Regulations Could Reshape the Industry
Brian Armstrong, CEO of Coinbase Global, recently revealed that the exchange may be forced to delist Tether’s stablecoin, USDT, if regulators mandate it or if Tether fails to comply with emerging U.S. laws. Armstrong, a vocal advocate for clear cryptocurrency regulations, emphasized the importance of regulatory adherence in shaping the future of digital assets.
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According to a report from the Wall Street Journal (WSJ), Armstrong acknowledged USDT’s popularity among Coinbase users and expressed the company’s intention to maintain its availability as long as compliance is ensured. His comments come shortly after Coinbase delisted USDT for Eurozone residents, a move attributed to regulatory requirements under European Union laws.
As highlighted by Bitcoin.com News, Coinbase, which holds a stake in stablecoin issuer Circle, justified the Eurozone delisting as a response to new regulations requiring issuers to obtain e-money licenses and maintain cash reserves at banks—a policy Tether has reportedly resisted.
“There are a lot of people with Tether, and we want to give them an off-ramp while helping them transition to a system we believe is more secure,” Armstrong explained.
The Impact of Pending U.S. Stablecoin Legislation
The U.S. is expected to revisit stablecoin regulations under the Trump administration, with proposed legislation requiring issuers to hold reserves primarily in U.S. Treasury bonds. If passed, these laws would compel Tether and other stablecoin providers to convert non-Treasury assets into compliant holdings.
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Tether, which reported a $2.5 billion profit in Q3 2024, disclosed reserves exceeding $105 billion, including $102.5 billion in U.S. Treasuries and $20 billion in other assets like precious metals and secured loans. However, critics argue that such diversification may face scrutiny under stricter U.S. policies.
Despite the regulatory uncertainty, the WSJ noted that neither of the proposed stablecoin bills has made significant legislative progress. However, should such measures gain traction, Tether and other issuers may face pressure to overhaul their operational models to meet compliance standards, potentially reshaping the global stablecoin market.
