JPMorgan Analysts Announce That Tether May Have to Sell Its Bitcoins (USDT)! Here's why!

Analysts at JPMorgan have warned that Tether may need to sell non-compliant assets, including Bitcoin (BTC), precious metals, corporate papers, and collateralized loans, in order to comply with (USDT)** proposed U.S. stablecoin regulations.

JPMorgan: Tether May Need to Sell Bitcoin to Comply with U.S. Stablecoin Regulations

Proposed Stablecoin Regulations

The U.S. has introduced two stablecoin bills aimed at creating clearer regulatory oversight for stablecoin issuers:

• STABLE Act (House of Representatives) - Focuses on state-level regulation and stricter reserve requirements.
• GENIUS Act (Senato) – Proposes federal oversight for large issuers and broader reserve asset allowances.

JPMorgan analysts, led by Nikolaos Panigirtzoglou, estimate that under these bills, only 66% of Tether's reserves will comply with the STABLE Act, while 83% will meet the standards of the GENIUS Act.

According to a published report, these figures indicate a declining compliance rate since mid-24 as Tether's supply has increased.

If both designs are enacted, Tether, which holds approximately 60% of the stablecoin market, will need to restructure its reserves by shifting more funds to US Treasuries and other liquid assets.

Due to the Crypto Asset Markets (MiCA) regulations requiring companies to hold 60% of major stablecoin issuers' reserves in EU banks, the company is currently facing regulatory scrutiny in Europe.

This led to Tether being removed from several European exchanges, but its relatively small market share in the region mitigated the impact.

In contrast, Tether's presence in the U.S. market is more significant, making compliance with potential new regulations a greater challenge.

Analysts suggest that these bills could weigh on Tether's dominant position, as they mandate high-quality, liquid reserves and require greater transparency and frequent auditing.