As Tether faces criticism from Deutsche Bank regarding its USDT operations, the company’s CEO defends their practices and emphasizes their market role.
Deutsche Bank's recent analysis has sparked significant debate within the financial sector by highlighting potential risks in Tether’s USDT operations. The report casts doubt on the longevity of stablecoins like USDT, noting that only 14% of 334 currency pegs reviewed since 1800 have remained stable.
Stablecoins, particularly USDT, are crucial in the crypto market, providing traders with a stable asset amid volatility. However, Deutsche Bank's report questions Tether’s stability and transparency, referencing past regulatory issues, including a $41 million fine from the Commodity Futures Trading Commission in 2021 and an $18.5 million settlement with the New York Attorney General.
Despite these concerns, Tether CEO Paolo Ardoino remains optimistic, defending Tether's role and highlighting their cooperation with global regulators. Ardoino emphasized that Tether's dominance is beneficial for the market and not a negative aspect as competitors might suggest.
The report also mentions Tether’s significant market share, with USDT holding over 69% dominance in the stablecoin market according to DefiLlama. This has raised concerns about potential risks to the cryptocurrency ecosystem.
Furthermore, the US and European Union are contemplating new regulations that could impact stablecoin issuers like Tether, potentially influencing compliance and operational standards.
