Tether USDT faces a two-year compliance countdown, with around 25% reserves or failure to meet standards

Comparatively, on the first anniversary of the signing of the GENIUS Act, the future of Tether USDT in the US market is uncertain. The bill provides a three-year compliance grace period, with about two years remaining. At that time, stablecoins that do not meet the standards will not be able to be traded on US crypto platforms.

According to Tether's latest disclosure, about 25% of USDT reserves are still allocated to assets that do not meet the requirements of the GENIUS Act, such as precious metals, loans, and Bitcoin. The law requires issuers to reserve the full amount of highly liquid assets such as cash and US Treasury bonds. Tether CEO Ardoino promised compliance last year. The company launched the USAT stablecoin for the US market through Anchorage Digital this year, but usage is still low.

The legal community is divided over the compliance timeline for foreign issuers. Some lawyers believe that foreign issuers must immediately comply with the freeze and seizure orders when the law comes into effect (expected January next year), but it will take about two years to meet the remaining requirements. Anchorage Digital's head of policy said institutional users will switch early to compliant stablecoins before the 2028 cutoff date. Currently, federal regulators have not finalized the implementation rules of the GENIUS Act, and there are no specific regulations for companies to follow. Tether did not respond to CoinDesk's request for comment on compliance progress.