Ripple CEO Brad Garlinghouse recently commented on how safe and legal Tether’s USDT stablecoin is. In response, Tether CEO Paolo Ardoino spoke out strongly. Two big names in the world of cryptocurrencies are going against each other.
Garlinghouse said earlier this week in a statement that he was afraid that more scrutiny from U.S. officials could upset the cryptocurrency market as a whole, with a focus on Tether. He recently talked about how Ripple would soon release a stablecoin backed by USD.
Tether CEO Rebukes Ripple’s Garlinghouse Amid Regulatory Scrutiny
In his answer, Ardoino didn’t name either Garlinghouse or Ripple by name, but it sounds like he had been speaking to Ripple’s head. In a Monday post on X, Ardoino said an “uninformed CEO” was in charge of a business being investigated by the SEC. He thought Garlinghouse’s words were meant to scare people away from USDT.
What Garlinghouse said has some background to it. Worries about how open USDT is and how it could be used to get around U.S. bans have been making the news more and more lately. Based on what TRM Labs has found, Tether has been used to get around economic restrictions by terrorist groups and countries that are subject to sanctions, like Russia.
People who use cryptocurrencies are also worried about stablecoins like USDT that are distributed in countries other than the ones where they were created. They think these coins could be connected to illegal financial activities. Concerns like these have led to calls for the government to keep a closer eye on things and for stablecoin producers to be more open.
Ardoino made a case for Tether by saying that hundreds of millions use the coin, mostly in emerging and new markets. He also talked about USDA’s past of stable prices, big cash reserves, honest management, and many rules that must be followed.
Ardoino also tried to answer complaints about Tether’s compliance record by highlighting the company’s efforts to work with law enforcement worldwide and follow all regulatory rules. He said that since its start, Tether has stopped more than $1.3 billion in possibly illegal funds, most of which are connected to scams, hacks, and money laundering.
In the past, some people have said that Tether wasn’t clear about the assets that backed USDT. The company has taken steps to fix these problems, like letting third-party auditors look at the books every three months. The Commodity Futures Trading Commission fined Tether $41 million in October 2021 for lying to customers about its assets.
There are more and more problems in the cryptocurrency community, and the fight between Tether and Ripple shows how hard it is for stablecoin creators to deal with government scrutiny and calls for openness.
