Stablecoin Tether gets boost as dollar alternative in emerging markets, CEO says

"Almost the entire user base is (in) emerging markets", he said, mentioning Turkey, Vietnam, Brazil, Argentina and "African countries", where dollars can sometimes be in short supply.

"Last year for sure Argentina has been booming," he added.

Ardoino said Tether had just over 300 million users globally.

"We want to be the dollar for the last mile, for the unbanked," he said. Regulators have long warned about market risks from the adoption of crypto assets. The Bank for International Settlements said in a paper last year that crypto assets had amplified financial risks in developing economies, in contrast to their "illusory appeal of being a simple and quick solution for financial challenges".

In Argentina, cryptocurrency exchanges can play a role in the currency market, with locals and international traders alike using the Tether-peso pair on crypto exchanges as a proxy for the U.S. dollar-to-peso exchange rate. Crypto markets have mostly recovered from the collapses that saw prices plunge in 2022. Bitcoin, the world's most valuable cryptocurrency, hit an all-time high of $73,803.25 in March, driven by excitement around inflows into U.S. spot bitcoin exchange-traded funds (ETFs), which Ardoino said had also supported Tether's growth.

Ardoino, who became CEO in December while keeping the interim role of chief technology officer, said the company was hiring more people and would have around 150 staff, from about 100 currently, as it expands into new areas such as AI.

U.S. regulators have warned banks that stablecoin reserves could be subject to rapid outflows, for example if holders rushed to exchange such tokens back into traditional currency.

Tether, the third biggest cryptocurrency, says it maintains its dollar peg by holding dollar-based reserves that match the volume of cryptocurrencies it has created.

Source: Forex-Markets-Economic Times

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