Ripple CEO Voices Concerns Over US Scrutiny of Tether

Ripple CEO Brad Garlinghouse has highlighted U.S. regulatory attention on Tether, noting that potential actions against the prominent stablecoin issuer could impact the entire cryptocurrency market. Garlinghouse discussed this during an episode of the World Class podcast, stressing Tether's integral role in the crypto ecosystem and his concerns about the ripple effects of U.S. scrutiny.

The U.S. government's concerns with Tether involve its use by sanctioned entities to avoid economic sanctions. Deputy Secretary of the U.S. Treasury, Adewale Adeyemo, testified about Russia utilizing Tether's USDT to circumvent sanctions, particularly for military funding. Additionally, a UN report has documented USDT's role in money laundering on the TRON blockchain, particularly through illegal gambling platforms.

Despite these allegations, Tether claims to maintain strict compliance with regulatory standards, actively cooperating with law enforcement to curb illicit activities. This includes freezing accounts associated with illegal actions. Tether remains the leading stablecoin with a market cap of roughly $110 billion and reported substantial profits recently.

Amidst these challenges, Ripple is making its own foray into the stablecoin arena. The company announced last month its plan to launch a fully-backed stablecoin, aiming to enrich the XRP Ledger ecosystem and diversify the crypto landscape. Further details are expected soon, with a possible reveal of the stablecoin's name by June, hinted by Ripple CTO David Schwartz.