Tether CEO Paolo Ardoino has argued that the increasing competition in the stablecoin market is a positive development and a testament to Tether’s success. “Growing competition across the stablecoin market is not only positive,” Ardoino stated, “it’s also a product of Tether’s success.” His comments come as new stablecoins enter the market, challenging Tether’s dominance. Ardoino believes this competition will drive innovation and strengthen the overall stability and reliability of digital currencies, ultimately benefiting the entire cryptocurrency ecosystem.
With Tether’s USDT boasting a market capitalization of over $114 billion, it stands as the world’s third-largest cryptocurrency. Dominating the U.S. dollar-pegged stablecoin market, it significantly outpaces Circle’s USDC, which holds a $34 billion market cap. According to sources, other stablecoins, such as the recently launched one by PayPal, are also vying for market share, with Ripple set to introduce another later this year. Recent reports also suggest that State Street is contemplating a similar move.
Ardoino welcomes this competition, even if it impacts Tether’s profits. “More competition will make the entire stablecoin industry much more solid,” he said. “We might eventually make less money, but I believe that we have a good chance to lead the space for a long time because we understand it better than anyone.”
He differentiates Tether’s approach from that of its competitors. “I see our competition always focusing on banking and institutions, and I believe that the world is made up of 7 to 8 billion people, of which 5 billion people need our services, and we understand that much better.”
Understanding the potential skepticism, Ardoino emphasized that expanding user access in emerging and developing countries is more crucial than simply boosting USDT’s market cap.
Traditionally, stablecoin trading volumes have mirrored the overall cryptocurrency market. However, Ardoino noted that USDT is gradually “decoupling” from other digital assets. “Over time, it’s decoupling from the pure crypto industry,” he said. “I would consider today, USDT more like a digital dollar, not even a cryptocurrency anymore”
Tether CEO Paolo Ardoino: USDT Adoption on the Rise?
Ardoino highlighted that USDT’s daily trading volumes often surpass those of bitcoin and ether combined. He envisions the token evolving into a “global payment system” increasingly utilized by nations producing raw materials and battling high inflation. “We are seeing USDT being used for purchasing cotton, purchasing also gold,” he said. “It’s a nascent interest, but we are getting a lot of questions about how USDT could revolutionize and help the commodities industry.”
He pointed out that countries like Turkey, Argentina, and Brazil show a growing interest in using USDT for raw material purchases, driven by high inflation issues.
A Bloomberg report recently noted that some unsanctioned Russian firms have used USDT and other cryptocurrencies for cross-border transactions, primarily with Chinese clients and suppliers. Sanctioned countries have historically turned to cryptocurrencies for payment settlements. In response to criticism about Tether’s stablecoin being used by illicit actors, the company has initiated measures to curb such misuse. “The reality is that it would be very, very stupid for anyone that is on a sanctioned list to use USDT,” said Ardoino. “The usage of USDT … from bad actors is microscopic, but of course, it makes the news.”
Ardoino’s insights reflect the evolving significance of stablecoins in the global financial landscape. Tether’s commitment to inclusivity and broad access aligns with its mission to provide financial services to billions. By embracing competition and innovation, Tether aims to cement its leadership in the stablecoin sector.
In summary, Tether CEO Paolo Ardoino strongly believes that competition among stablecoin issuers is vital for the industry’s health and credibility. By fostering a diverse and robust market, stablecoins can continue to expand and cater to a growing global user base.
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