According to Tether CEO Paolo Ardoino, the primary function of USDT, the world’s largest stablecoin, is to shield individuals in economies with high inflation from eroding purchasing power.
In a conversation only with CryptoMoon, Ardoino revealed that Tether prioritizes extending access to USDT to people without conventional banking services.
“[USDT] is a tool that helps people in places that have been forgotten by the banking industry. These 300 million people are of no interest to the banking industry. These are great people, but they cannot be onboarded by the banking industry because they are too poor to be of interest.”
Inflation running out of control is pushing individuals in developing countries to seek financial refuge outside their own economies, with the US dollar being a popular choice. This concern is particularly acute in Argentina, where the local currency has plummeted in value against the dollar, as stated by Ardoino – losing an alarming 98% of its worth.
“What you want to do if you live in Argentina is to buy the U.S. dollar… We think about USDT as the tool that is helping people. So we have to be so focused on making it the safest that it can be. That’s why we have T-bills, gold, and Bitcoin. But now our approach is to be 100% in T-bills in the next few quarters.”
Tether holds the title as the globe’s most valuable stablecoin, boasting a market capitalization of over $109 billion, significantly more than Circle’s USDC with its $33 billion market value, based on information from CoinMarketCap.
According to Ardoino, Tether’s achievement can be linked to discovering an ideal market niche – individuals requiring financial services and access to U.S. dollars. On the other hand, rival stablecoin issuers aim to target the traditional banking sector with their offerings. The CEO elaborated:
“So our biggest competitors focus on the banking industry as their customers. But the banking industry has already the best, the best access to the dollar. They have credit cards, debit cards, and banking rails. They work in jurisdictions like Europe and the U.S. where people don’t need stablecoins.”
According to Ardoino, the use of stablecoins in Europe and the US is on the verge of decreasing significantly. However, he emphasized that focusing on providing financial services to the unbanked population remains a key objective for the stablecoin provider.
“The people that need a stablecoin are the ones that live in emerging markets. And these people need stability. They need to know that whatever happens, they can redeem for $1.”
On April 1, Tether successfully passed a SOC 2 audit, which is considered the top-tier security evaluation for organizations. In simpler terms, this means that Tether’s security practices have been rigorously examined and meet the highest industry standards.
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2024-04-19 16:35