Listen up, guys, the SEC just dropped a bombshell that could shake up the stablecoin sector.
In a rare moment of clarity, they’ve defined what they call “covered stablecoins,” which are essentially digital dollars that don’t qualify as securities.
New stablecoin paradigm?
These stablecoins must be pegged to the US dollar, backed by liquid assets, and redeemable on demand.
Sounds simple, right? But here’s the catch, because they can’t offer profits or governance rights.
Now, this guidance is a mixed bag. On one hand, it provides a clear path for stablecoins like USDC. On the other, it casts doubt on whether Tether’s USDT fits the bill.
Why? Because USDT’s reserves include Bitcoin and gold, which are explicitly disqualified by the SEC’s criteria. It’s like trying to fit a square peg into a round hole.
New stablecoin from Tether?
Rumors are circulating that Tether might launch a new stablecoin to comply with these regulations, so this would mean the new asset would be fully backed by cash and US Treasuries. A major shift for Tether.
It’s a bit like a high-stakes game of regulatory chess. Meanwhile, crypto analysts are warning that USDT might be considered a security in the US, which could lead to some serious restrictions
Mixed reactions from the industry
Industry reactions are all over the place. Some, like David Sacks, welcome the clarity, saying it could ease regulatory burdens.
Others, like SEC Commissioner Caroline Crenshaw, are critical, arguing that the guidance downplays risks and oversimplifies the market.
— Lucas (@LucasOutumuro) April 4, 2025
It’s a bit like watching a debate where everyone has a different opinion on the same issue.
Despite the volatility, stablecoins are gaining traction. Their usage is up, even in a tough market. So, what does this mean for Tether and the future of stablecoins?
Will they adapt and thrive, or will they struggle to keep up? We’ll see.
Have you read it yet? PayPal announced that Solana and Chainlink join the party
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