The rise of Tether, the issuer of USDT, which is approaching a market cap of $100 billion, was deemed "risky" by JPMorgan analysts.

In their latest report, the bank's analysts, led by Nikolaos Panigirtzoglou, said, "Tether's deficiencies in regulatory compliance and transparency involve major risks. As such, we believe that the firm's massive rise over the past year is not good for stablecoins and the broader crypto ecosystem."

Response from Tether CEO: Hypocrisy...

Paolo Ardoino, the famous CEO of Tether, did not remain indifferent to this report of JPMorgan aanlists and responded. "It's good that they understand the size and importance of Tether, but I think it's hypocritical for JPMorgan, the world's largest bank, to talk about dominance within another industry," Ardoino said in a statement.

Ardoino also said, "Our growth is due to people's trust in us. Families and individuals in developing countries use Tether to hedge against inflation. Our reliance on our reserves and those who rely on us are the main factors that increase our strength."

"Circle prepares for regulations"

On the other hand, JPMorgan analysts, who also mentioned Circle, USDC's issuer and Tether's biggest competitor, also wrote that the company's IPO application is part of the preparation for regulations.

As it will be remembered, the banking crisis in the USA last year also dealt a heavy blow to the Circle company. Circle, which has $3 billion of its assets in Silicon Valley Bank, had a hard time after the bank's bankruptcy, and USDC's bond to $1 fell below 0.90.

Tether, which is not based in the United States, survived this crisis at the lowest level and became by far the strongest among the stablecoins in the ecosystem.

Published: February 2, 2024 10:57 AMLast Updated: February 2, 2024 11:12 AM