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Bloomberg reported that Tether Holdings Ltd., a stablecoin operator, is expanding its dominant market share after achieving record profits. JPMorgan Chase & Co. expressed concerns, stating that this poses a risk to the overall cryptocurrency market.
According to a report released by JPMorgan Chase on Thursday, the centralization of USDT has increased over the past two years, solidifying its position as the leading stablecoin. However, the lack of regulatory compliance and transparency in Tether is seen as an escalating risk for the market.
JPMorgan analysts wrote, "Stablecoin issuers more compliant with existing regulations may benefit from the upcoming stablecoin regulatory crackdown and gain market share." Tether has been working on improving transparency through quarterly attestations since paying a $41 million fine to the CFTC in 2021 for falsely reporting reserves.
Despite these efforts, the report suggests that Tether's stablecoin lags behind competitors like Circle in terms of regulatory compliance with the USDC token. Stablecoins are expected to face stricter regulations in the United States and Europe soon. While the Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act is awaiting a vote in the U.S. House of Representatives, the EU's Markets in Crypto Assets (MiCA) is anticipated to be partially implemented in June.
Paolo Ardoino, CEO of Tether, stated in a release, "Tether's market dominance may be 'negative' for competitors, including the banking industry, looking to achieve similar success, but it has never been negative for the market that needs us the most. We have been working closely with global regulatory authorities, providing them with education on the technology and guidance on how to approach this issue."
In other news, three Chinese government bodies have established goals for building a blockchain standardization system, aiming to accelerate the development of key blockchain standards and promote the high-quality development of the blockchain industry.
Additionally, Hong Kong is set to consult on a proposed regulatory framework for over-the-counter (OTC) virtual asset service providers (VASPs). The Financial Services and the Treasury Bureau Chief, Christopher Hui, mentioned the government's intention to include OTC platforms in regulation. The existing VASP licensing system has been in effect since June, with two licensed virtual asset trading platforms upgrading their licenses to offer BTC and ETH trading services to retail investors.
Venture Smart Financial Holdings Ltd. (VSFG) in Hong Kong has announced plans to apply for a spot Ethereum ETF in Q2 and expects to launch its spot Bitcoin ETF in Q1.
CryptoQuant founder Ki Young Ju publicly apologized to Tether CEO Paolo Ardoino, stating that Tether has submitted financial details to the U.S. SEC. This clarification comes as the approval of a spot Bitcoin ETF resolves Tether's audit issues, as one reason for the SEC's previous denial was related to "market manipulation activities" associated with Tether.
The Biden administration has initiated an "urgent" investigation into the electricity consumption of Bitcoin miners in the U.S. Concerns have risen with the surge in Bitcoin prices, potentially leading to more miners coming online and placing a greater burden on the power grid.
Justin Schmidt, Chief Operating Officer of Ondo, predicts that the potential market size of interest-bearing stablecoins may surpass the current demand for stablecoins. Ondo recently launched its governance token and currently offers two tokens providing U.S. Treasury bond yields, OUSG for qualified investors and USDY, a stablecoin backed by bank deposits and U.S. Treasury bonds, offering income from underlying assets. |
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Post time 17-2-2024 17:03:28