{"id":839367,"date":"2025-04-06T08:12:11","date_gmt":"2025-04-06T13:12:11","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2025\/04\/06\/what-are-secs-new-covered-stablecoins-tethers-usdt-may-not-qualify\/"},"modified":"2025-04-06T08:12:11","modified_gmt":"2025-04-06T13:12:11","slug":"what-are-secs-new-covered-stablecoins-tethers-usdt-may-not-qualify","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2025\/04\/06\/what-are-secs-new-covered-stablecoins-tethers-usdt-may-not-qualify\/","title":{"rendered":"What Are SEC\u2019s New \u201cCovered Stablecoins\u201d? Tether\u2019s USDT May Not Qualify!"},"content":{"rendered":"<div role=\"main\" id=\"main-content-row\">\n<article id=\"the-post\" data-post-url=\"https:\/\/coinpedia.org\/news\/tether-eyes-new-u-s-stablecoin-after-secs-new-crypto-guidelines\/\" data-post-title=\"What Are SEC\u2019s New \u201cCovered Stablecoins\u201d? Tether\u2019s USDT May Not Qualify!\" data-post-edit=\"https:\/\/coinpedia.org\/wp-admin\/post.php?post=440823&#038;action=edit\">\n<div>\n<figure><img width=\"1200\" height=\"628\" src=\"https:\/\/image.coinpedia.org\/wp-content\/uploads\/2024\/03\/04184504\/Tethers-Surge-to-100Bn-Market-Cap-Mints-1Bn-USDT-As-Bitcoin-Price-Hit-65000-.webp\" alt data-main-img=\"1\" decoding=\"async\" fetchpriority=\"high\"  ><\/figure>\n<\/div>\n<div>\n<p>In a rare and clear move, the U.S. Securities and Exchange Commission (SEC) has introduced new guidance that could significantly impact the stablecoin market. The agency said that certain stablecoins \u2013 now called \u201ccovered stablecoins\u201d \u2013 may not be treated as securities, as long as they follow strict conditions.<\/p>\n<p>The crypto industry has already begun to respond. Tether, one of the largest stablecoin issuers, is reportedly considering changing its strategy to fit within the SEC\u2019s new framework.<\/p>\n<blockquote>\n<p><em>\u201cCovered Stablecoins are not marketed as investments; rather, they are marketed as a stable, quick, reliable and accessible means of transferring value, or storing value and not for potential profit or as investments,\u201d the SEC stated.<\/em><\/p>\n<\/blockquote>\n<h2 id=\"h-what-exactly-is-a-covered-stablecoin\">What Exactly Is a \u201cCovered Stablecoin\u201d?<\/h2>\n<p>The SEC explained that covered <a href=\"https:\/\/markets.coinpedia.org\/stable-coins\/\">stablecoins<\/a> are not offered as investment products. Instead, they\u2019re presented as a stable, fast, and accessible way to send or store money\u2014not something to make a profit from.<\/p>\n<p>To qualify as a covered stablecoin, the token must meet several key requirements:<\/p>\n<ul>\n<li>Be fully backed 1:1 by the U.S. dollar<\/li>\n<li>Be supported by low-risk, highly liquid assets<\/li>\n<li>Be redeemable at full value at any time<\/li>\n<\/ul>\n<p>These stablecoins must not offer interest, promise profits, give voting rights, or represent any form of ownership. They are meant strictly for use in payments, transfers, or storing value\u2014not as investments.<\/p>\n<p>Since they\u2019re sold as \u201cdigital dollars\u201d and not investment opportunities, the SEC says these stablecoins don\u2019t count as securities under U.S. law. This kind of clarity is unusual for the SEC, which often takes a more cautious or enforcement-first approach to crypto.<\/p>\n<p>Also Read: <a href=\"https:\/\/coinpedia.org\/news\/ftx-disqualifies-2-5b-in-claims-after-kyc-deadline-missed-by-392000-users\/\">FTX Rejects Nearly 400,000 Claims Worth $2.5 Billion \u2013 Here\u2019s What Happened<\/a><\/p>\n<h2 id=\"h-mixed-reactions-from-experts\">Mixed Reactions from Experts<\/h2>\n<p>David Sacks, a White House crypto advisor, welcomed the update. He said it offers much-needed clarity and reduces regulatory hurdles for dollar-backed stablecoins that are fully supported by safe assets. He also noted that these types of tokens would no longer need to register under the Securities Act.<\/p>\n<figure>\n<div>\n<blockquote data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">The SEC has determined that fully-reserved, liquid, dollar-backed stablecoins are not securities. Therefore blockchain transactions to mint or redeem them do not need to be registered under the Securities Act. Helpful clarity from <a href=\"https:\/\/twitter.com\/SECGov?ref_src=twsrc%5Etfw\">@SECGov<\/a>. <a href=\"https:\/\/t.co\/oUsq0snLaF\">pic.twitter.com\/oUsq0snLaF<\/a><\/p>\n<p>\u2014 David Sacks (@davidsacks47) <a href=\"https:\/\/twitter.com\/davidsacks47\/status\/1908263063650001144?ref_src=twsrc%5Etfw\">April 4, 2025<\/a><\/p><\/blockquote><\/div>\n<\/figure>\n<p>However, <a href=\"https:\/\/www.sec.gov\/newsroom\/speeches-statements\/crenshaw-statement-stablecoins-040425\" target=\"_blank\" rel=\"noreferrer noopener\">SEC Commissioner Caroline Crenshaw<\/a> disagreed. She warned that the guidance oversimplifies how stablecoins actually work and overlooks key legal issues. Crenshaw argued that the risks involved are being downplayed, and the update could create confusion about how these tokens function<\/p>\n<h2 id=\"h-tether-faces-new-challenges\">Tether Faces New Challenges<\/h2>\n<p>The new rules may benefit stablecoins like USDC, but they raise concerns for Tether\u2019s USDT. That\u2019s because the SEC doesn\u2019t allow stablecoins to be backed by assets like cryptocurrency or gold\u2014both of which are included in USDT\u2019s reserves.<\/p>\n<p>According to <em>Forbes<\/em> reporter Nina Bambysheva, Tether is now exploring the idea of launching a new stablecoin that would fully follow U.S. rules. This new coin would be backed only by cash and U.S. Treasuries, marking a major shift for the company.<\/p>\n<figure>\n<div>\n<blockquote data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">Tether is considering the development of a stablecoin tailored for the U.S. market and intends to launch a competitor to ChatGPT within the next few months, <a href=\"https:\/\/twitter.com\/paoloardoino?ref_src=twsrc%5Etfw\">@paoloardoino<\/a> tells me. More to come soon<\/p>\n<p>\u2014 Nina Bambysheva (@ninabambysheva) <a href=\"https:\/\/twitter.com\/ninabambysheva\/status\/1908235278474747986?ref_src=twsrc%5Etfw\">April 4, 2025<\/a><\/p><\/blockquote><\/div>\n<\/figure>\n<p>Crypto analyst Novacula Occami also noted that Tether\u2019s use of Bitcoin and gold in its reserves could make USDT ineligible for the \u201ccovered stablecoin\u201d label. That could expose it to stricter regulations under U.S. securities law.<\/p>\n<h2 id=\"h-tether-s-plan-for-a-u-s-compliant-stablecoin\">Tether\u2019s Plan for a U.S.-Compliant Stablecoin<\/h2>\n<p>Despite the potential regulatory pressure, Tether doesn\u2019t seem too worried about a possible U.S. ban on USDT. According to CTO Paolo Ardoino, the company is already thinking ahead and preparing to launch a separate U.S.-compliant stablecoin.<\/p>\n<p>Ardoino said USDT will likely remain focused on emerging markets, while the new stablecoin would be designed specifically for the U.S. market and built to comply with American regulations.<\/p>\n<p>Even as the wider crypto market struggles through a difficult first quarter, stablecoins are seeing strong growth. Daily usage continues to rise, and the stablecoin market added over $30 billion in Q1 alone \u2013 showing that demand remains high despite broader market uncertainty.<\/p>\n<p><strong>It\u2019s not every day the SEC speaks plainly on crypto \u2013 so when it does, the industry listens!<\/strong><\/p>\n<\/div>\n<div>\n<h2>We&#8217;d Love to Hear Your Thoughts on This Article!<\/h2>\n<div>\n<h4>Was this writing helpful?<\/h4>\n<\/div>\n<\/div><\/div>\n<p><a href=\"https:\/\/coinpedia.org\/news\/tether-eyes-new-u-s-stablecoin-after-secs-new-crypto-guidelines\/\" class=\"button purchase\" rel=\"nofollow noopener\" target=\"_blank\">Read More<\/a><br \/>\n Nidhi Kolhapur<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In a rare and clear move, the U.S. Securities and Exchange Commission (SEC) has introduced new guidance that could significantly impact the stablecoin market. The agency said that certain stablecoins \u2013 now called \u201ccovered stablecoins\u201d \u2013 may not be treated as securities, as long as they follow strict conditions. The crypto industry has already begun<\/p>\n","protected":false},"author":1,"featured_media":839368,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23652,92677],"tags":[],"class_list":{"0":"post-839367","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-covered","8":"category-secs"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/839367","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=839367"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/839367\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/839368"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=839367"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=839367"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=839367"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}