In a recent podcast interview, Ripple’s CEO Brad Garlinghouse stated that Tether, the largest Stablecoin issuer by market share, is next on the US government’s target list. Tether’s CEO, Paolo Ardoino, refuted Garlinghouse’s comments and accused him of spreading fear.
Is Tether Next In Line?
Ripple’s CEO joined Quantum’s founder, Chris Vasquez, for his World Class podcast on May 10. During the interview, he discussed his outlook for the future of crypto and his thoughts on the US government’s crackdown on the industry.
New Episode with Brad Garlinghouse @bgarlinghouse, CEO of @Ripple is live!
We Cover:– Brad's wild journey scaling Ripple– Fighting SEC Lawsuits, the importance of taking risk & being courageous– Invaluable CEO lessons on building culture, hiring A+ players & enduring teams-… pic.twitter.com/VQqrH4CfaX
— Chris Vasquez (@imchrisvasquez) May 10, 2024
Regarding unforeseen circumstances, Garlinghouse believes the crypto market has shown remarkable resilience despite the adversities. The CEO used the downfall of FTX and the immense regulatory scrutiny that Binance has faced over the last couple of years to back his point.
Two years ago, FTX and Binance were two of the most influential companies in the industry. Similarly, their founders and CEOs, Sam Bankman-Fried and Changpeng ‘CZ’ Zhao, were some of the most important players in crypto, as Garlinghouse highlighted.
Since then, SBF has been sentenced to 20 years in prison, while CZ has stepped down as Binance’s CEO and was recently sentenced to a four-month incarceration. To Ripple’s CEO, these events would have been impossible to predict, adding that black swans are “hard to know” as unpredictability is part of the event’s nature.
Despite this, he considers what the community and industry have endured over the years shows a positive side, as the “freaking resilience of this industry and market (…) should give us immense optimism about what’s coming.”
Garlinghouse believes there will be another Black Swan. He also stated that it would be “an interesting one to watch,” despite not being sure what it could be.
To him, it’s clear that the “US government is going after Tether.” Ultimately, he added that a crackdown on the company could have a big impact due to its “important part of the crypto ecosystem.”
Tether’s CEO Responds
On Monday, Paolo Ardoino took X to respond to the comments. The CEO called Garlinghouse “an uninformed CEO,” and suggested that he was spreading FUD (fear, uncertainty, and doubt) about USDT.
Ardoino seemingly took the comments as an attack from someone “leading a company being investigated by the SEC, launching a competitive stablecoin.” As a result, he decided to update the community on the safety of Tether’s ecosystem.
An uniformed CEO, leading a company being investigated by the SEC, launching a competitive stablecoin (cui prodest), is being reported spreading fear about USDt.
Let me give you an update on Tether USDt ecosystem safety.
USDt is the most used stablecoin in the world, with…
— Paolo Ardoino
(@paoloardoino) May 13, 2024
The CEO highlighted USDT’s status as “the most used stablecoin in the world, with hundreds of millions of users across primarily emerging markets and developing countries.” Moreover, he added that most mainstream media reporters refuse to report data regarding Tether’s global compliance work.
Ardoino’s post listed various factors that affect Tether’s compliance. These included Tether’s collaboration with 124 law enforcement agencies across 40+ countries, its respect for the OFAC / SDN lists, and its blockage of over $1.3 billion related to scams, hacks, money laundering, and terrorist financing.
To the CEO, the refusal to share Tether’s statistics sets a “sensationalistic” narrative against the usage of stablecoins and cryptocurrencies worldwide, likely to protect the old guard of the financial establishment.
Garlinghouse responded to the post, clarifying his intentions behind the comments. He explained that he wasn’t attacking the stablecoin issuer. Instead, he pointed out that the US government had “clearly indicated they want more control over USD-backed stablecoin issuers.”
Thus, Tether’s status as the largest player in the sector made it “first in line” for a regulatory crackdown.
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