Tether (USDT), the leading stablecoin, surpassed the financial giants in just 90 days and boasts an impressive run rate of $11.4 billion annually. This success has led to nearly $100 billion in circulation, which exceeded Goldman Sachs' profits last quarter, as reported by Bitwise CIO Matt Hogan.
However, JPMorgan has expressed concerns about Tether's dominance, citing regulatory and transparency issues.
Growing to $100 billion!
JPMorgan analysts led by Nikolaos Panigirtzoglou see Tether's growing dominance over the past year as a potential risk to stablecoins and the broader crypto market. There is. Transparency regarding Tether's regulatory challenges is seen as a drawback for long-term investors.
Tether CEO Paolo Ardoino defended stablecoins, suggesting their advantages could make competitors such as banks nervous. He highlighted the positive impact on markets relying on Tether and emphasized allocating 15% of operating profits to Bitcoin purchases.
Unique approach and strong financials
Pompliano supports Tether and notes its unique approach of holding reserves in various investments for availability and protection. With $5.4 billion in excess capital and more than $100 million in profit per employee, Tether's financial strength positions it as a profitable global company.
Tether vs stablecoin
Contrary to concerns, the report suggests that other stablecoins, especially those that follow existing rules, could thrive. USD Coin (USDC), which aims to sell its shares publicly in the US, could benefit from Tether's regulatory challenges by proactively preparing for stablecoin regulations.
Despite the skepticism, Tether's market value and share has grown significantly. Tether, which is widely used by cryptocurrency exchanges and DeFi platforms, posted a record profit of $2.85 billion last quarter, showing its resilience compared to USD Coin and Binance’s BUSD.
Read more: Stablecoin Market Report 2024: In-depth analysis and insights
approaching a milestone
As Tether approaches a market cap of $100 billion, questions are arising about regulatory oversight and the potential impact on other stablecoins.
