Tether CEO: Stablecoins Nearly Fully Backed by U.S. Treasuries, Questions BIS Push for Tokenized Bank Deposits

Stablecoin issuer Tether CEO Paolo Ardoino stated that stablecoins are a more credible form of money than tokenized bank deposits, with the former nearly fully backed by U.S. Treasuries, while the latter typically has only 10% liquidity asset backing. Bank for International Settlements (BIS) General Manager Pablo Hernandez de Cos noted that stablecoins face issues including redemption capacity, supply, interoperability, and facilitating crime, and described tokenized bank deposits as a more direct path to preserving the monetary system's foundation while leveraging tokenization. Ardoino pointed out that USDT's market capitalization has exceeded $183 billion and is used in some emerging markets for domestic and cross-border commerce. In discussions surrounding the Clarity for Digital Assets Market Transparency Act (CLARITY Act), banks are concerned that allowing crypto exchanges to offer rewards on stablecoins could trigger deposit outflows.