Today Tether unveiled its planned USAT stablecoin, an onshore digital currency that aims to be compliant with the GENIUS Act. Tether’s main stablecoin has a market capitalization of $169 billion, but the current makeup of its reserves would not comply with the new legislation. For example, some of Tether’s reserves are in Bitcoin, gold and commercial loans. Tether also revealed the appointment of Bo Hines, former Executive Director of the White House Crypto Council, as the future USAT CEO.

It was previously announced that Hines was joining Tether following his White House departure, but not that his role would be CEO of the US subsidiary. This shuffling of positions could add fuel to the ongoing ethical objections by Democrats, which risk is a distraction that risks delaying legislation for crypto market infrastructure.

Beyond the political implications, Tether faces practical challenges in establishing credibility for USAT. The onshore Tether ideally needs to have a different team to the current one, given Tether’s previous infractions. Tether notoriously made mis-statements about the backing of its stablecoin when it lent a substantial proportion of its reserves to a sister company with a hole in its balance sheet. As a result, it was sanctioned by both the State of New York and the CFTC. Since that period, Tether has become enormously profitable, earning $13 billion in 2024.

To help with shortcutting the legal process, USAT will not issue the coin itself, but will partner with Anchorage, the first, and currently only, national digital asset trust bank, although several other applications for a trust charters are now in progress.