Bitmex founder Arthur Hayes recently made a bold prediction that issuers, including leading stablecoin Tether, will eventually perish. The reason behind this is that when traditional banks like JPMorgan Chase are approved by the US Treasury Department to issue fiat-backed stablecoins, Tether’s business model will be undermined.
Cryptocurrency derivatives exchange Bitmex founder Arthur Hayes recently stated in a podcast called Unchained that while Tether has positioned itself as an excellent product in the cryptocurrency market, this is only because the US banking system refuses to offer similar products.
Regarding Tether’s business model, Arthur Hayes pointed out that it is at risk of being replaced by traditional banks. However, Hayes also stated that centralized stablecoins cannot function as they do now without the use of bank settlement and custodial funds. He criticized bank managers as “damn idiots” for providing services to stablecoin companies like Tether but not offering stablecoin services themselves.
In Arthur Hayes’ view, when the US Treasury Department allows traditional banks to issue stablecoins, the era of companies like Tether will come to an end, and the legitimacy and reserve backing of traditional banks will not be questioned.
Therefore, Arthur Hayes predicts that banks like JPMorgan Chase will replace Tether and other stablecoin companies.
While Arthur Hayes warned about Tether’s future, Tether itself is actively expanding its business. Tether CEO Paolo Ardoino announced in November last year that Tether plans to invest approximately $500 million in the next six months to build more mining pools and invest in other mining enterprises, aggressively entering the mining field.
According to Tether’s comprehensive reserve report, as of the third quarter of last year, Tether’s total investment in sustainable energy, Bitcoin mining, data, and P2P technology-related fields exceeded $800 million, with a third-quarter investment amount of $668 million.
Paolo Ardoino stated in October last year that Tether’s USDT will still be a critical product, and Tether will remain focused on the growth of USDT. However, the company is also expanding into new areas, and Tether will soon announce a real-world asset (RWA) platform called “Real World Ecosystem” (RWE).
Related Reports
Arthur Hayes: Is a Bitcoin Spot ETF Really a Good Thing?
Full Text of Arthur Hayes’ Blog: CZ and Binance Are Unjustly Treated! China Will Boost the Next Crypto Bull Market
Arthur Hayes: US Regulatory Treatment of Binance and CZ Is Absurd; Innovating Traditional Finance Is Penalized