This article examines Tether's balance sheet and capital adequacy in the context of its role as a digital deposit instrument. It critiques the common misconceptions about Tether's solvency and discusses the regulatory frameworks applicable to its operations, comparing it to traditional banking practices.

A power struggle is emerging among traditional banks, tech giants, and crypto firms like Tether and Circle as they seek to shape U.S. stablecoin regulations. Bank of America is lobbying for rules favoring established banks, while the ongoing rivalry between Tether and Circle highlights differing approaches to reserve management and compliance amidst growing concerns over financial stability.