In a developing story that underscores the evolving regulatory landscape for cryptocurrencies, industry leaders Circle and Tether have found themselves at odds over the future of stablecoin regulation in the United States. The clash comes as the Trump administration and lawmakers push forward with efforts to establish a comprehensive framework for these digital assets.
Jeremy Allaire, co-founder and CEO of Circle, has called for mandatory registration of all US dollar-based stablecoin issuers within the United States. Speaking at Circle’s Stablecoin Day event in New York City on February 25, 2025, Allaire emphasized the need for consumer protection and financial integrity in the stablecoin market.
“Whether you are an offshore company or based in Hong Kong, if you want to offer your US dollar stablecoin in the US, you should need to register in the US just like we have to go register everywhere else,” Allaire stated, highlighting the importance of a level playing field for all market participants.
Circle, the issuer of USD Coin (USDC), the second-largest stablecoin by market capitalization, has positioned itself as a compliant player in the industry. The company recently received approval from the Dubai Financial Services Authority (DFSA) for its stablecoins USDC and EURC, marking them as the first recognized tokens under the authority’s crypto regime.
In contrast, Tether, the largest stablecoin issuer and Circle’s main competitor, has faced ongoing scrutiny over its lack of transparency and regulatory oversight. The company recently relocated its headquarters to El Salvador, a move that has raised eyebrows in the regulatory community.
Paolo Ardoino, CEO of Tether, responded to the growing debate by accusing some major crypto firms of attempting to influence US stablecoin regulations to Tether’s detriment. “While our competitors’ business model should be to build a better product and an even bigger distribution network, their real intent is ‘Kill Tether,’” Ardoino stated on social media platform X.
The clash between these industry giants comes amid increasing regulatory momentum in the United States. Senator Bill Hagerty recently introduced a stablecoin bill in the Senate, proposing requirements for backing stablecoin payments with Treasury bills, US dollars, and Federal Reserve notes, alongside monthly audited reports.
As the stablecoin market continues to grow, with both Tether and Circle ramping up their minting activities, the need for clear regulation becomes increasingly urgent. Tether recently minted $1 billion worth of USDT on the Tron network, bringing their total minting volume to $3 billion in 2025. Meanwhile, Circle has minted $250 million USDC on Solana, contributing to their total of 7.75 billion minted this year.
The clash between Circle and Tether represents more than just a corporate rivalry; it embodies the larger challenges facing the stablecoin industry as it navigates the complex waters of regulation and mainstream adoption. As US policymakers move towards establishing a comprehensive stablecoin framework, the future of these digital assets will depend on how well issuers can adapt to new regulatory requirements while maintaining the innovation and efficiency that have made stablecoins a crucial part of the cryptocurrency ecosystem.
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