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coinpedia 2025-01-22 05:21:13

Coinbase to Delist USDT? Brian Armstrong Weighs New Regulatory Landscape

The post Coinbase to Delist USDT? Brian Armstrong Weighs New Regulatory Landscape appeared first on Coinpedia Fintech News Trump’s latest remarks after his inauguration on crypto regulations have created a euphoric moment for Bitcoin and other assets. Bitcoin came out of the choppy market with a smashing ATH of $109K. However, there is still fear and panic in the market as many think this new policy change may impact non-US entities. Raining serious doubt and to stay out of controversy, Coinbase CEO Brian Armstrong has hinted that the exchange may delist Tether’s USDT stablecoin if new U.S. legislation mandates stricter compliance requirements. The statement comes as the U.S. crypto industry anticipates regulatory changes that could reshape the stablecoin market. COINBASE CEO: TETHER MIGHT GET KICKED OFF IF THEY DON’T FOLLOW NEW US RULES Coinbase’s Brian Armstrong just dropped a bomb—if US stablecoin regs demand full Treasury backing, Tether’s gonna have to comply or get booted. He said they’d delist USDt if it doesn’t make the cut.… pic.twitter.com/R1waWm73vA — Mario Nawfal’s Roundtable (@RoundtableSpace) January 21, 2025 Regulatory Shifts Could Challenge Tether In an interview with the Wall Street Journal, Armstrong predicted that future U.S. regulations might require stablecoin issuers to back their reserves exclusively with U.S. Treasury bonds and undergo regular audits. While Tether already holds a significant portion of its reserves in Treasury bonds, it also diversifies with commodities like Bitcoin and gold, which could put it at odds with potential legislation. The CEO highlighted issues Tether has already faced in the EU under the MiCA framework, which has imposed stricter rules on stablecoin issuers. A similar regulatory push in the U.S. could severely disrupt Tether’s operations, despite its recent move to El Salvador to mitigate regulatory risks. Coinbase’s Position in the Stablecoin Market Armstrong emphasized Coinbase’s readiness to comply with any new laws, even if it means delisting USDT. He also highlighted Coinbase’s relationship with Circle, the issuer of the USDC stablecoin, which has positioned itself as a direct competitor to Tether. As a major shareholder in Circle, Coinbase could benefit from a regulatory environment that favors USDC, especially in the U.S. and European markets. Armstrong noted that the stablecoin market, currently valued at $218.7 billion, could see significant shifts if Tether is sidelined by new legislation. Why a Fear for Non-US Entities? Although the U.S. government is showing signs of a more crypto-friendly regulatory stance, enforcement actions remain a possibility, particularly for non-U.S. entities like Tether. Armstrong mentioned that two Senate bills aiming to impose restrictions on stablecoin issuers have been introduced but have yet to gain traction. Armstrong is sure that they will support the changing regulatory scenario even if it means supporting measures that could disrupt Tether’s dominance. This development signals a potential shake-up in the stablecoin market, with implications for both issuers and users. On the other hand, If Tether’s dominance drops it will be a better chance for Ripple’s (RLUSD) and Circle’s (USDC) to capture the market. Notably, Trump had a closed-door meeting this month with Ripple giving more reasons to believe that RLUSD to get a clear way out in the coming months to capture the $ 200 billion stablecoin market.

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