GENIUS Act: Will Tether Adapt or Be Pushed Out of the US Market?
The US Congress is moving fast with the GENIUS Act — a new bill designed to strictly regulate stablecoins, the digital assets pegged to the US dollar. If passed, companies issuing stablecoins will have to back their tokens ONLY with safe assets like cash or short-term government bonds — plus publish audited financial reports annually.
For Tether, the world’s biggest stablecoin issuer with $156 billion in circulation, this spells big trouble. Unlike its competitors, Tether backs its coins partially with Bitcoin and gold and doesn’t provide full public audits — a practice that won’t fly under the new rules.
Tether’s CEO Paolo Ardoino hinted they might launch a separate US-specific stablecoin to stay in the game. But with only 18 months to comply under one version of the bill, the clock is ticking — and failure to adapt could mean losing access to the lucrative US market.
Meanwhile, Circle — Tether’s biggest US rival — is already playing by the new rules and just went public, with its stock soaring over 50% after the Senate passed the GENIUS Act. If this law becomes reality, Circle could gain a huge edge.
The GENIUS Act also demands stablecoin firms cooperate with law enforcement — freezing assets linked to crime and reporting suspicious activity just like regular banks.
Tether is already moving its HQ to El Salvador and expanding in Asia and Latin America, but losing the US market would be a massive blow. Will Tether adapt, or will the US stablecoin throne change hands? Only time will tell.
