{"id":899743,"date":"2026-04-17T13:11:42","date_gmt":"2026-04-17T18:11:42","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2026\/04\/17\/tether-launches-stablecoin-wallet-circles-arc-chain-going-proof-of-stake\/"},"modified":"2026-04-17T13:11:42","modified_gmt":"2026-04-17T18:11:42","slug":"tether-launches-stablecoin-wallet-circles-arc-chain-going-proof-of-stake","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2026\/04\/17\/tether-launches-stablecoin-wallet-circles-arc-chain-going-proof-of-stake\/","title":{"rendered":"Tether launches stablecoin wallet, Circle\u2019s Arc chain going proof-of-stake"},"content":{"rendered":"<div>\n<div>\n<ol>\n<li><a href=\"https:\/\/coingeek.com\">Homepage<\/a><\/li>\n<li> > <\/li>\n<li><a href=\"https:\/\/coingeek.com\/news\/\">News<\/a><\/li>\n<li> > <\/li>\n<li><a href=\"https:\/\/coingeek.com\/news\/category\/business\/\"><br \/>\n                                Business<br \/>\n                       <\/a><\/li>\n<li> > <\/li>\n<li>Tether launches stablecoin wallet, Circle\u2019s Arc chain going proof-of-stake<\/li>\n<\/ol>\n<\/div>\n<p id=\"top\"><a href=\"https:\/\/coingeek.com\/news\/tag\/tether\/\" target=\"_blank\" rel=\"noreferrer noopener\">Tether<\/a> launched a <a href=\"https:\/\/coingeek.com\/bitcoin101\/go-cashless-the-rise-of-stablecoins-as-payment\/\" target=\"_blank\" rel=\"noreferrer noopener\">stablecoin<\/a> wallet, <a href=\"https:\/\/coingeek.com\/news\/tag\/circle\/\" target=\"_blank\" rel=\"noreferrer noopener\">Circle<\/a> (<a href=\"https:\/\/finance.yahoo.com\/quote\/CRCL\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">NASDAQ: CRCL<\/a>) defended its reluctance to freeze stolen USDC, and the U.S. Federal Reserve says stablecoins still aren\u2019t being used the way crypto boosters claim they are.<\/p>\n<ul>\n<li><a href=\"http:\/\/coingeek.com\/#tether\">Tether wallet launches, world (allegedly) rejoices<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#south-korea\">South Korean \u2018revenge firms\u2019 offer murder-for-USDT<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#circle\">Circle defends non-response to freezing pleas, claims hands are tied<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#circle-arc\">Circle\u2019s ARC network shifting to proof-of-stake<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#visa\">Visa embracing stablecoin network validator role<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#federal-reserve\">Federal Reserve report finds stablecoin payments under 1% of total use<\/a><\/li>\n<li><a href=\"http:\/\/coingeek.com\/#imf\">IMF offers tips for avoiding stablecoin bank runs<\/a><\/li>\n<\/ul>\n<p id=\"tether\">On April 14, Tether <a href=\"https:\/\/tether.io\/news\/tether-launches-tether-wallet-the-peoples-wallet-extending-its-global-financial-infrastructure-directly-to-billions-of-users-left-behind-by-the-traditional-financial-system\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">announced<\/a> the debut of tether.wallet, a self-custodial tool aimed at bringing \u201cthe widest and most granular money distribution network built by humanity\u201d to end users (ahem). The new wallet \u201coffers the only assets that truly matter for most of the people,\u201d aka Tether\u2019s USDT and <a href=\"https:\/\/coingeek.com\/tether-launches-us-facing-stablecoin-circle-investors-say-meh\/#usat\" target=\"_blank\" rel=\"noreferrer noopener\">USAT<\/a> dollar-backed stablecoins, the <a href=\"https:\/\/coingeek.com\/fidelity-launching-its-own-stablecoin-tether-loves-gold\/#tether\" target=\"_blank\" rel=\"noreferrer noopener\">gold-backed XAUT<\/a>, and <a href=\"https:\/\/coingeek.com\/news\/tag\/btc\/\" target=\"_blank\" rel=\"noreferrer noopener\">BTC<\/a> (double ahem).<\/p>\n<p>The wallet, built using Tether\u2019s open-source Wallet Development Kit, is designed to \u201cremove the technical complexity that has historically limited broader adoption of digital assets. Users can send funds using a simple, human-readable identifier such as <a href=\"http:\/\/coingeek.com\/cdn-cgi\/l\/email-protection#3c525d51597c48594854594e125159\" target=\"_blank\" rel=\"noreferrer noopener nofollow\"><span data-cfemail=\"3658575b53764253425e5344185b53\">[email\u00a0protected]<\/span><\/a>,\u201d which will hopefully eliminate the kind of fat-fingered mistakes that are common with normal, lengthy wallet addresses.<\/p>\n<p>All tether.wallet transfers are \u201csigned locally on the user\u2019s device before being broadcast to the network.\u201d Transaction fees will be paid with the asset being transferred, eliminating the need for separate network or \u201cgas\u201d tokens.<\/p>\n<p>For the time being, tether.wallet users can transfer USDT on Ethereum, Polygon, Plasma and Arbitrum; USAT on Ethereum; XAUT on Ethereum, Polygon, Plasma and Arbitrum; and BTC onchain and via the Lightning Network, BTC\u2019s <a href=\"https:\/\/coingeek.com\/the-lightning-network-is-dying\/\" target=\"_blank\" rel=\"noreferrer noopener\">unreliable Layer-2 \u2018scaling solution\u2019<\/a> (and <a href=\"https:\/\/coingeek.com\/lightning-network-an-obstacle-for-criminal-investigations-says-europol\/\" target=\"_blank\" rel=\"noreferrer noopener\">scourge of law enforcement<\/a>) The list of supporting networks is set to \u201cexpand rapidly within next 30 days,\u201d allowing \u201cseamless swaps\u201d and an \u201cinsane user experience.\u201d (Triple ahem.)<\/p>\n<p>Tether CEO Paolo Ardoino <a href=\"https:\/\/x.com\/paoloardoino\/status\/2044024770635636801\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">called<\/a> the new tool \u201cThe People\u2019s Wallet,\u201d which has a vaguely socialist tone for a purely capitalist enterprise, but never mind. Ardoino claimed that \u201cTether\u2019s technology is used by more than 570 million people globally\u201d and this is growing by \u201ctens of millions of new wallets added per quarter.\u201d<\/p>\n<p id=\"south-korea\"><strong>Rape, murder\u2026 it\u2019s just a Tether away<\/strong><\/p>\n<p>Some of these new South Korean wallets are now offering \u201crevenge\u201d services\u2014up to and including murder\u2014in exchange for USDT. Earlier this month, <a href=\"https:\/\/www.newscj.com\/news\/articleView.html?idxno=3390585\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">South Korean media<\/a> reported on a \u201crevenge agency\u201d advertising its services on the Telegram messaging platform, capitalizing on what the report called \u201cindividual vengefulness and anonymity technology.\u201d<\/p>\n<p>Police reported that these revenge tactics include smearing human feces on victims\u2019 dwellings, gluing door locks shut, scattering leaflets in victims\u2019 neighborhoods alleging unsavory activities by the victims, etc. The revenge firms then double-dip by extorting the victims with threats of additional retaliation if they don\u2019t pay up.<\/p>\n<p>Police have arrested some alleged participants, including <a href=\"https:\/\/www.ytn.co.kr\/_ln\/0103_202604030959553558\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">a suspected ringleader<\/a>. But other groups <a href=\"https:\/\/www.chosun.com\/national\/weekend\/2026\/04\/11\/G7OOPTEI3VDIHIZHVSJP2TQOYY\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">appear undeterred<\/a> and continue to promote everything from \u201cdebt resolution,\u201d to \u201cschool violence resolution,\u201d to \u201cupper or lower body disabilities\u201d to \u201caccidental death.\u201d Prospective clients are asked to make a deposit of 50% of the asking price \u201cin cryptocurrency (Tether\/USDT)\u201d and are reassured that \u201cclients cannot be traced thanks to Telegram and cryptocurrency.\u201d<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p id=\"circle\"><strong>Circle pushes back on freezing criticism<\/strong><\/p>\n<p>Tether will presumably be asked by South Korean authorities to freeze the contents of USDT wallets linked to these revenge groups. Over the past year or so, Tether has been keen to promote its cooperation with law enforcement, looking to rehabilitate USDT\u2019s reputation as the fuel that drives <a href=\"https:\/\/coingeek.com\/crypto-role-in-pig-butchering-scams-laid-bare-in-new-icij-report\/\" target=\"_blank\" rel=\"noreferrer noopener\">criminals<\/a>, <a href=\"https:\/\/coingeek.com\/tether-hates-terrorism-less-concerned-about-human-slavery\/\" target=\"_blank\" rel=\"noreferrer noopener\">terrorists<\/a>, and <a href=\"https:\/\/coingeek.com\/did-tether-freeze-venezuela-stablecoins-is-iran-next\/#trm\" target=\"_blank\" rel=\"noreferrer noopener\">sanctions-evaders<\/a>.<\/p>\n<p>But both Tether and Circle have come under fire for their <a href=\"https:\/\/coingeek.com\/tether-2025-sees-profits-down-loans-up-controversy-constant\/#tether-circle\" target=\"_blank\" rel=\"noreferrer noopener\">inconsistent approach to freezing tokens linked to illicit activity<\/a>. Last week, Circle was publicly called out for <a href=\"https:\/\/coingeek.com\/polymarket-launching-stablecoin-circle-slow-to-act-in-drift-exploit\/#circle\" target=\"_blank\" rel=\"noreferrer noopener\">failing to act in a timely manner<\/a> to freeze USDC tokens linked to a $285 million exploit of the Solana-based Drift Protocol by North Korean hackers.<\/p>\n<p>On April 10, Circle\u2019s chief strategy officer Dante Disparte published the company\u2019s response to this criticism, titled \u201c<a href=\"https:\/\/www.circle.com\/blog\/when-open-systems-are-tested-accountability-rule-of-law-and-the-work-ahead\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">When Open Systems Are Tested: Accountability, Rule of Law, and the Work Ahead<\/a>.\u201d<\/p>\n<p>The post noted some of the crypto community\u2019s calls for Circle to freeze tokens, as well as others who urged Circle not to intervene and let <a href=\"https:\/\/coingeek.com\/digital-asset-recovery-should-blockchains-enforce-property-rights\/\" target=\"_blank\" rel=\"noreferrer noopener\">\u2018code is law\u2019<\/a> rule the day. Disparte claimed \u201cthe tension between [these two positions] is exactly where the most important policy work for crypto and open internet financial systems are playing out.\u201d<\/p>\n<p>Disparte said that when Circle freezes USDC, \u201cit is not because we have decided, unilaterally or arbitrarily, that someone\u2019s assets should be taken from them. It is because the law requires us to act.\u201d Circle\u2019s freezing ability is \u201ca compliance obligation\u2014exercised only when we are legally compelled by an appropriate authority, through lawful process.\u201d<\/p>\n<p>Disparte said Circle \u201cstands ready to support recovery and accountability efforts with ecosystem participants, and with law enforcement, to the fullest extent the law permits.\u201d But \u201cthe legal frameworks that would authorize faster, more coordinated action\u2014while meaningfully preserving property rights and privacy protections\u2014do not yet fully exist \u2026 This is a policy problem. And policy problems have policy solutions.\u201d<\/p>\n<p>Essentially, Disparte argued that Circle is unable to act until the crypto ecosystem, regulatory bodies and law enforcement agencies all agree on a way forward. \u201cThe goal is not a system where private companies unilaterally decide who loses access to their assets. The goal is a system where legally sanctioned, rights-preserving interventions can happen at the speed of the threat.\u201d<\/p>\n<p>Circle CEO Jeremy Allaire echoed this view during a stopover this week in South Korea, where he <a href=\"https:\/\/www.theblock.co\/post\/397180\/circle-ceo-allaire-defends-decision-not-to-freeze-usdc-in-drift-exploit-citing-moral-quandary\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">claimed<\/a> it was \u201ca very risky proposition\u201d to suggest that Circle \u201cshould just step away from what the law says and \u2026 make its own decisions.\u201d<\/p>\n<p>Allaire also claimed to be working with U.S. lawmakers on the Senate\u2019s digital asset market structure bill (<a href=\"https:\/\/coingeek.com\/us-senate-re-enters-the-digital-asset-market-structure-arena\/#clarity\" target=\"_blank\" rel=\"noreferrer noopener\">CLARITY Act<\/a>) to include a \u201csafe harbor\u201d for stablecoin issuers. This harbor would allow issuers to take preventative actions in certain circumstances while offering legal cover for these actions.<\/p>\n<p>Blockchain sleuth ZachXBT, who led the post-Drift criticism of Circle, <a href=\"https:\/\/x.com\/zachxbt\/status\/2043666029935743079\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">responded<\/a> by calling Allaire\u2019s hedging \u201ca completely made up statement.\u201d ZachXBT noted Circle\u2019s own <a href=\"https:\/\/www.circle.com\/legal\/user-agreement\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">terms of service<\/a>, in which Circle reserves the right to \u2018block\u2019 or \u2018freeze\u2019 certain USDC addresses that it determines \u201cin its sole discretion, may be associated with illegal activity.\u201d<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p id=\"circle-arc\"><strong>Circle\u2019s Arc to rely on proof-of-stake consensus mechanism<\/strong><\/p>\n<div>\n<p>On a more productive note, Circle announced <a href=\"https:\/\/www.koreatimes.co.kr\/economy\/cryptocurrency\/20260413\/circle-ceo-rules-out-won-based-stablecoin-issuance-instead-seeks-local-partnerships\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">memorandums of understanding<\/a> (MoU) with two of South Korea\u2019s leading exchanges, <a href=\"https:\/\/coingeek.com\/news\/tag\/bithumb\/\" target=\"_blank\" rel=\"noreferrer noopener\">Bithumb <\/a>and <a href=\"https:\/\/coingeek.com\/news\/tag\/upbit\/\" target=\"_blank\" rel=\"noreferrer noopener\">Upbit<\/a>. For the time being, the MoU\u2019s are effectively exploratory, as the country is still wrestling with its <a href=\"https:\/\/coingeek.com\/south-korea-draft-crypto-bill-covers-stablecoins-rwas\/\" target=\"_blank\" rel=\"noreferrer noopener\">long-delayed digital asset legislation<\/a>, which will (someday) create a regulated stablecoin market in the crypto-savvy nation.<\/p>\n<p>The ongoing uncertainty of South Korea\u2019s legislative plans likely contributed to Allaire declaring that \u201cI don\u2019t believe Circle would issue a Korean won stablecoin.\u201d But Circle \u201cmay find ways to partner with Korean won issuers\u201d and support the consortiums of local banks, fintechs, and crypto firms that will take point on won-backed stablecoin initiatives.\n<\/p>\n<\/div>\n<p>Allaire also used his <a href=\"https:\/\/www.youtube.com\/live\/v8gt5KBsazQ?si=9MgQYtsnTYe66oN3&#038;t=941\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">\u201cCircle in Seoul\u201d presentation<\/a> to confirm Circle\u2019s plan to issue a native token on <a href=\"https:\/\/coingeek.com\/circle-revenue-and-profits-rise-shares-tank\/#Arc,-USYC,-CPN\" target=\"_blank\" rel=\"noreferrer noopener\">Arc<\/a>, the company\u2019s \u201centerprise-grade, stablecoin-native\u201d Layer-1 \u201ceconomic operating system.\u201d He didn\u2019t expand much beyond <a href=\"https:\/\/coingeek.com\/circle-revenue-and-profits-rise-shares-tank\/#Arc,-USYC,-CPN\" target=\"_blank\" rel=\"noreferrer noopener\">last November\u2019s comments<\/a> that Circle was \u201cexploring the possibility\u201d of an Arc-native token, but he did say that this token would \u201chelp provide mechanisms for governance, incentives [and] economic alignment.\u201d<\/p>\n<p>But bigger news came when Allaire <a href=\"https:\/\/www.youtube.com\/live\/v8gt5KBsazQ?si=DLskP8Q7wyQZ2a4A&#038;t=1881\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">said<\/a> the plan was to \u201cultimately move [Arc] into a <a href=\"https:\/\/coingeek.com\/ethereum-makes-the-final-plunge-to-proof-of-stake\/\" target=\"_blank\" rel=\"noreferrer noopener\">proof-of-stake<\/a> system over time.\u201d Allaire said the company hopes to \u201chave more to share about that in the not too distant future.\u201d<\/p>\n<p>A proof-of-stake network relies on a large number of independent \u201cvalidators\u201d to allocate a specific amount of network tokens to participate in the transaction consensus mechanism, for which they are rewarded with additional tokens. This differs from the more traditional <a href=\"https:\/\/coingeek.com\/proof-of-work\/\" target=\"_blank\" rel=\"noreferrer noopener\">proof-of-work<\/a> system in which a smaller number of <a href=\"https:\/\/coingeek.com\/news\/tag\/block-reward-mining\/\" target=\"_blank\" rel=\"noreferrer noopener\">block reward miners<\/a> compete to validate transactions, \u2018find\u2019 network blocks and claim the block rewards.<\/p>\n<p>Arc is still in testnet, but Allaire said the transition to mainnet would happen \u201csoon,\u201d with a beta version expected sometime this year.<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p id=\"visa\"><strong>Visa keeps making stablecoin moves<\/strong><\/p>\n<p><a href=\"https:\/\/coingeek.com\/hyperliquid-stablecoin-auction\/#stripe\" target=\"_blank\" rel=\"noreferrer noopener\">Tempo<\/a>, the stablecoin-focused Layer-1 launched last year by payment processor <a href=\"https:\/\/coingeek.com\/news\/tag\/stripe\/\" target=\"_blank\" rel=\"noreferrer noopener\">Stripe<\/a>, relies on a <a href=\"https:\/\/simplex.blog\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Simplex consensus<\/a> protocol that similarly requires validators. On April 14, <a href=\"https:\/\/coingeek.com\/news\/tag\/visa\/\" target=\"_blank\" rel=\"noreferrer noopener\">Visa<\/a> (<a href=\"https:\/\/www.nasdaq.com\/market-activity\/stocks\/v\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">NASDAQ: V<\/a>) <a href=\"https:\/\/investor.visa.com\/news\/news-details\/2026\/Visa-Launches-Validator-Node-on-Tempo-Blockchain\/default.aspx\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">announced<\/a> that it has joined Tempo as an anchor validator to support network transactions, joining Stripe and Zodia Custody by Standard Chartered as Tempo\u2019s first external validators.<\/p>\n<p>Visa\u2019s head of crypto Cuy Sheffield said the move expands the company\u2019s years of developing its blockchain expertise by \u201crunning critical blockchain infrastructure ourselves \u2026 supporting the development of stablecoin payment systems that meet the high operating standards our clients and partners expect.\u201d<\/p>\n<p>Visa\u2019s node was configured and managed in-house after six months of work with Tempo\u2019s engineering team. Tempo GTM Nischay Upadhyayula hailed Visa\u2019s reputation for \u201coperational rigor,\u201d adding that the credit card giant has been \u201ca design partner since day one, and joining as a validator is a natural extension of that work.\u201d<\/p>\n<p>Tempo\u2019s <a href=\"https:\/\/x.com\/tempo\/status\/2034253571340804546\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">mainnet went live<\/a> last month along with its new Machine Payments Protocol (MPP), an open standard that allows <a href=\"https:\/\/coingeek.com\/ai-agentic-economy-fails-on-blockchain-unless-its-bsv\/\" target=\"_blank\" rel=\"noreferrer noopener\">agentic AI<\/a> and services to coordinate payments programmatically. Visa has already extended MPP to support card payments on its network.<\/p>\n<p>Visa has embarked on multiple stablecoin initiatives in recent years, including tie-ups with <a href=\"https:\/\/coingeek.com\/bermuda-taking-economy-onchain-thanks-to-coinbase-circle-usdc\/#stablecoin-infrastructure-pool\" target=\"_blank\" rel=\"noreferrer noopener\">BVNK<\/a>, <a href=\"https:\/\/coingeek.com\/circle-revenue-and-profits-rise-shares-tank\/#rewards\" target=\"_blank\" rel=\"noreferrer noopener\">Circle<\/a>, <a href=\"https:\/\/www.prnewswire.com\/news-releases\/rain-and-visa-partner-to-accelerate-onchain-credit-cards-302443827.html\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Rain<\/a>, <a href=\"https:\/\/reap.global\/products\/card-issuing\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Reap<\/a>, and more. In March, Visa <a href=\"https:\/\/investor.visa.com\/news\/news-details\/2026\/Visa-to-Bring-Privacy-Preserving-Payments-to-Canton-Network\/default.aspx\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">announced<\/a> it would serve as a \u201csuper validator\u201d on the <a href=\"https:\/\/coingeek.com\/news\/tag\/canton-network\/\" target=\"_blank\" rel=\"noreferrer noopener\">Canton Network<\/a>, the privacy-focused chain \u201cbuilt for regulated finance\u201d and backed by a consortium that includes Visa, Circle, Goldman Sachs (<a href=\"https:\/\/www.nasdaq.com\/market-activity\/stocks\/gs\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">NASDAQ: GS<\/a>), BNY Mellon (<a href=\"https:\/\/www.nasdaq.com\/market-activity\/stocks\/dmf\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">NASDAQ: DMF<\/a>), and others.<\/p>\n<p>Visa will serve as one of ~40 Canton super validators, but is the first major global payments firm to join this party. Visa says its presence will help crypto-wary institutions \u201cexperiment with and scale stablecoin payments, settlement and treasury use cases without changing how they already manage risk, compliance and operations.\u201d<\/p>\n<p>Canton\u2019s head of network strategy, Eric Saraniecki, said the network \u201cwas built to meet the requirements of regulated finance from day one. Visa\u2019s participation as a Super Validator reinforces that this technology has matured beyond experimentation and into production\u2011ready infrastructure.\u201d<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p id=\"federal-reserve\"><strong>Federal Reserve says nobody\u2019s using stablecoins for payments<\/strong><\/p>\n<p>There are numerous studies showing that stablecoins\u2019 primary use case is still largely limited to <a href=\"https:\/\/coingeek.com\/uk-stablecoin-survey-shows-its-still-all-about-token-trading\/#U.K.\" target=\"_blank\" rel=\"noreferrer noopener\">speculative trading pairs<\/a>, at least in developed markets. Emerging markets are more likely to use stablecoins as a store of value or for cross-border remittances, but overall stablecoin payment volume currently accounts for <a href=\"https:\/\/coingeek.com\/tether-launches-us-facing-stablecoin-circle-investors-say-meh\/#mckinsey\" target=\"_blank\" rel=\"noreferrer noopener\">\u201croughly 0.02%\u201d of the global total<\/a>.<\/p>\n<p>This month, the Federal Reserve Bank of Kansas City offered its own conclusions in a research briefing titled \u201c<a href=\"https:\/\/www.kansascityfed.org\/research\/payments-system-research-briefings\/what-are-stablecoins-used-for-today-estimating-the-distribution-of-stablecoins\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">What are Stablecoins used for Today?<\/a>\u201d While acknowledging that the data is threadbare, lead payments specialist Franklin Noll found that payments (B2B, P2P, etc.) accounted for just 0.7% of all stablecoin use, equal to about $2 billion annually.<\/p>\n<p>Transfers accounted for the largest slice of this stablecoin pie at 29.3%, although Noll cautions that this consists \u201cmainly of high-value movements into and out of DeFi (<a href=\"https:\/\/coingeek.com\/news\/tag\/decentralized-finance\/\" target=\"_blank\" rel=\"noreferrer noopener\">decentralized finance<\/a>) protocols and for internal treasury applications.\u201d<\/p>\n<p>Exchange-based activity claimed a 26.4% share, while \u2018finance\u2019 (DeFi) added 17.2% and \u2018infrastructure\u2019 accounted for 5.1%. Noll defines the latter as \u201cprimarily\u201d <a href=\"https:\/\/coingeek.com\/estimated-4b-laundered-via-dexs-coin-swaps-and-bridges-report\/\" target=\"_blank\" rel=\"noreferrer noopener\">cross-chain bridges<\/a>, \u201cindicating that interoperability problems exist.\u201d These three categories collectively account for over half of all stablecoin functionality.<\/p>\n<p>Another 21.2% of stablecoins are deemed to be \u201cidle,\u201d aka stablecoins \u201csitting in rarely used wallets, forgotten, lost, or held as small savings.\u201d Noll notes that \u201crarely used stablecoin wallets may also be a sign that the wallet and its contents are being used as a de facto fiat-denominated savings account,\u201d particularly in countries with unstable currencies subject to rapid depreciation.<\/p>\n<p>Noll concludes by remarking that \u201calthough stablecoins are widely believed to have the potential to operate independently of crypto finance \u2026 the large role played by crypto finance in the stablecoin ecosystem also suggests that the entire ecosystem is sensitive to the vagaries of crypto finance, rising and falling with the market.\u201d<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p id=\"imf\"><strong>IMF discusses how to avoid stablecoin \u2018bank runs\u2019<\/strong><\/p>\n<p>Finally, the International Monetary Fund (IMF) followed up its recent <a href=\"https:\/\/coingeek.com\/imf-warns-tokenized-finance-may-raise-crisis-risk\/#stablecoins-or-scbdc\" target=\"_blank\" rel=\"noreferrer noopener\">report on tokenized finance<\/a> with a new working paper titled \u201c<a href=\"https:\/\/www.imf.org\/-\/media\/files\/publications\/wp\/2026\/english\/wpiea2026074-source-pdf.pdf\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Making Stablecoins Stable<\/a>.\u201d The paper highlights the need for \u201csafe\u201d fiat reserve assets underpinning stablecoins and the resulting trade-off \u201cbetween maintaining stability and incentivizing issuance.\u201d<\/p>\n<p>The paper notes the potential for \u201cruns\u201d on stablecoin assets, like the one in March 2023 that caused Circle\u2019s USDC to slip its 1:1 peg with the dollar and fall to $0.87. That plunge followed the <a href=\"https:\/\/coingeek.com\/silicon-valley-bank-follows-silvergate-into-the-abyss-what-comes-next\/\" target=\"_blank\" rel=\"noreferrer noopener\">demise of Silicon Valley Bank<\/a> (SVB), where Circle had parked $3.3 billion of its cash reserves.<\/p>\n<p>The IMF authors offer three options to minimize the risks of runs, including (a) requiring issuers to hold \u201cvery safe and liquid assets,\u201d (b) requiring issuers to hold \u201cadditional loss-absorbing equity,\u201d and (c) providing \u201cpublic backstops to ensure issuers can honor redemptions even in crisis times,\u201d including \u201ca form of deposit insurance, access to central bank liquidity standing facilities, and emergency lending.\u201d<\/p>\n<p>The U.S. Federal Deposit Insurance Corporation (FDIC) recently offered its recommendations for implementing the stablecoin-focused <a href=\"https:\/\/coingeek.com\/crypto-week-ends-with-genius-act-passage\/\" target=\"_blank\" rel=\"noreferrer noopener\">GENIUS Act<\/a>, under which <a href=\"https:\/\/coingeek.com\/what-easier-passing-clarity-act-or-escaping-from-mordor\/#genius\" target=\"_blank\" rel=\"noreferrer noopener\">stablecoin issuers\u2019 reserves would be eligible for deposit insurance<\/a>, but stablecoin holders wouldn\u2019t enjoy the same privileges.<\/p>\n<p>The IMF warns that the risks of stablecoin insolvency increase when issuers hold riskier assets with unstable valuations. The IMF singles out Tether, which counted <a href=\"https:\/\/coingeek.com\/tether-2025-sees-profits-down-loans-up-controversy-constant\/\" target=\"_blank\" rel=\"noreferrer noopener\">nearly $50 billion in non-traditional assets<\/a>\u00a0(gold, BTC, \u2018secured loans\u2019) in its $193 billion worth of reserves as of December 31, 2025. (A desire to purge these riskier assets could explain why Tether is currently trying to <a href=\"https:\/\/coingeek.com\/polymarket-launching-stablecoin-circle-slow-to-act-in-drift-exploit\/#tether-does-the-hard-sell\" target=\"_blank\" rel=\"noreferrer noopener\">raise billions of dollars in cash from outside investors<\/a>.)<\/p>\n<p>The IMF concludes that issuers should be required to hold \u201csafe and liquid\u201d central bank reserves, generating revenue from their remuneration. This wouldn\u2019t fly in the U.K., where the government has proposed requiring issuers to <a href=\"https:\/\/coingeek.com\/tether-commits-to-big-four-audit-circle-share-price-falls-20\/#circle\" target=\"_blank\" rel=\"noreferrer noopener\">hold 40% of their reserves in unremunerated Bank of England accounts<\/a>.<\/p>\n<p>The IMF also suggests issuers could boost revenue by \u201cdata utilization,\u201d aka selling transaction data to third parties like any other digital platform, provided such activity is lawful where the data is collected. Apart from the resistance this would likely face from users, the IMF notes that this would favor \u201clarger providers due to scale and network economies related to data analysis, potentially leading to market concentration.\u201d<\/p>\n<p>For the record, Tether and Circle already claim a combined 84% share of the stablecoin market, so we humbly suggest that \u2018concentration\u2019 ship has sailed.<\/p>\n<p><em><a href=\"http:\/\/coingeek.com\/#top\">Back to the top \u2191<\/a><\/em><\/p>\n<p>Watch: Here\u2019s how Triple Entry Accounting guarantees trust in accounting<\/p>\n<figure>\n<div>\n<p><iframe src=\"https:\/\/www.youtube.com\/embed\/dCTbH42ezM4?feature=oembed\" frameborder=\"0\" allowfullscreen> frameborder=&#8221;0&#8243; allow=&#8221;accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share&#8221; referrerpolicy=&#8221;strict-origin-when-cross-origin&#8221; allowfullscreen><\/iframe><\/p>\n<\/div>\n<\/figure>\n<div>\n<p><h3>Tagged:<\/h3>\n<\/p>\n<\/div><\/div>\n<p><a href=\"https:\/\/coingeek.com\/tether-launches-stablecoin-wallet-circle-arc-chain-going-proof-of-stake\/\" class=\"button purchase\" rel=\"nofollow noopener\" target=\"_blank\">Read More<\/a><br \/>\n Steven Stradbrooke<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Homepage &gt; News &gt; Business &gt; Tether launches stablecoin wallet, Circle\u2019s Arc chain going proof-of-stake Tether launched a stablecoin wallet, Circle (NASDAQ: CRCL) defended its reluctance to freeze stolen USDC, and the U.S. Federal Reserve says stablecoins still aren\u2019t being used the way crypto boosters claim they are. Tether wallet launches, world (allegedly) rejoices South<\/p>\n","protected":false},"author":1,"featured_media":899744,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2432,22944],"tags":[],"class_list":{"0":"post-899743","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-launches","8":"category-tether"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/899743","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=899743"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/899743\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/899744"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=899743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=899743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=899743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}