The CEO of Tether Limited, Paolo Ardoino, came out in response to the statements made by Ripple’s CEO.
Persecution and fear surround USDT. Ardoino reminded that he has collaborated with more than 120 law enforcement agencies in over 40 countries. Amid U.S. regulatory pressure against companies in the cryptocurrency sector, USDT stablecoin issuer Tether Limited is back on everyone’s lips. According to Ripple Labs CEO Brad Garlinghouse, the U.S. government is continuing its regulatory crusade and is targeting Tether Limited, the issuer of the USDT stablecoin. However, the leader of that company denied such an assertion. In a podcast last weekend, Garglinghouse, who is at the helm of one of the entities that has gone through the most tirades with the U.S. government, said that U.S. authorities are now “going after Tether Limited.”
“That’s clear to me. I see Tether as an important part of the ecosystem, and I don’t know how to predict the impact it would have on the rest of the ecosystem,” Garlinghouse said. It is a warning from one of the companies in the cryptocurrency sector since 2020, which has been litigating with the U.S. Securities and Exchange Commission (SEC). It is an entity that accuses Ripple Labs of, among other things, violating federal securities laws.
In addition to being immersed in a legal battle with the SEC, Ripple intends to include itself in the competition of stable cryptocurrencies. They recently announced that their stablecoin will arrive in December. An asset in a market practically controlled by two giants. USD Coin, from the company Circle, and the USDT. Both cryptoassets have 1:1 parity with the U.S. dollar. In addition to Ripple, other companies are looking for a place in the stablecoin market. PayPal launched its stablecoin last year.
Spreading fear
In the face of what Ripple Labs CEO said, Paolo Ardoino, CEO of Tether Limited, denied that the U.S. government thinks about going against them amid its regulatory crusade. In a lengthy message posted on X, Ardoino claimed that Garlinghouse, “who runs an SEC-investigated company launching a stablecoin to compete,” is “spreading fear about USDT.” Ardoino insisted in his post that USDT, the most widely used stable cryptocurrency worldwide, has “solid stability, highly liquid reserves, top-tier custodians, and deep regulatory compliance.”
Ardoino further argued that USDT has leveraged “the transparency of blockchain technology,” working “with global law enforcement.” In that way, he recalled that stablecoin “respects” the Office of Foreign Assets Control (OFAC) list, meaning they do not operate with entities or subjects sanctioned by the U.S. Ardoino recalled that Tether Limited teamed with blockchain and security analytics firm Chainalysis to “have the best software and training for proactive transaction monitoring activity.”
Last May 3, Tether Limited announced a partnership with Chainalysis to implement transaction monitoring tools in the markets where people trade USDT. In his narrative, Paolo Ardoino, CEO of Tether Limited, also recalled that the company has collaborated with more than 120 law enforcement agencies in over 40 countries. Likewise, they have blocked $1.3 billion to date. “Mostly related to scams, hacks, and money laundering,” says the executive. Paolo Ardoino also recalled that, voluntarily, Tether collaborated with 198 requests from law enforcement authorities to block cryptocurrency wallets in the last 12 months. Of those, 90 requests from U.S. authorities.
What’s going on with USDT?
The latter are factors that, for Ardoino, could prevent the U.S. government from wanting to pursue its regulatory outpost against Tether Limited. This country has taken steps against the industry, with arrests and indictments against companies and referents of the cryptocurrency sector. The U.S. government authorities arrested and charged the founders of Samourai Wallet, a privacy-preserving Bitcoin wallet. Authorities accused the wallet founders of enabling money laundering. The former CEO of the world’s largest cryptocurrency exchange, Binance, Changpeng Zhao, was sentenced to four months in jail for the same crime.
In this context of persecution, Tether Limited also stands out. That company seems to be under siege by regulators worldwide, considering that, for example, the United Nations (U.N.) warned this year about using USDT for money laundering and scams despite its collaboration with the U.S. government. Likewise, in the United States, a bill was introduced to regulate stablecoins such as USDT, establishing limits for issuing these assets. Senators Kirsten Gillibrand and Cynthia Lummis presented the proposal. The latter showed a clear preference for USD Coin from the company Circle.
Likewise, and amid the regulatory siege, Binance disassociated itself from USDT. They wanted to avoid employing that stablecoin in its user protection fund. All this amid the heavy regulatory scrutiny faced by that company, which revealed its plans to stick as closely as possible to the law, even if that means distancing itself from the big players in the ecosystem, such as Tether Limited.