Tether launches US-regulated stablecoin, banks warn of deposit flight risk

Tether has launched USA₮, a federally regulated U.S. stablecoin issued by Anchorage Digital Bank, marking its first fully compliant offering for American users under the newly enacted GENIUS Act.

The move comes as Standard Chartered warns that stablecoins could siphon as much as $100 billion from U.S. bank deposits as the market continues to expand.

Summary

• Tether launched USA₮, a federally regulated U.S. stablecoin issued by Anchorage Digital Bank under the GENIUS Act.
• Standard Chartered warned stablecoins could drain about $100 billion from U.S. bank deposits.
• As stablecoins scale toward a projected $2 trillion market by 2028, regulated tokens like USA₮ may accelerate institutional adoption .

USA₮ was introduced Monday to meet the requirements of the GENIUS Act, the first nationwide framework governing stablecoins sold to U.S. customers. The law mandates that dollar-backed tokens be issued by federally or state-qualified entities, effectively barring Tether’s flagship USDT from the U.S. market and prompting the creation of a separate, compliant token.

Former White House Crypto Council Executive Director Bo Hines is leading the initiative as CEO of Tether USA₮. The token is now live on Bybit, Crypto.com, Kraken, OKX, and MoonPay, with Cantor Fitzgerald serving as reserve custodian. Tether CEO Paolo Ardoino described USA₮ as “a dollar-backed token made in America” aimed at institutions requiring federal oversight.

The launch places Tether in more direct competition with Circle’s USDC, which has dominated U.S. institutional adoption due to its early regulatory alignment. USDT will continue operating internationally, where it has roughly $143 billion in circulation.

On the same day as the launch, Standard Chartered published a report warning that stablecoins pose a structural threat to bank funding. Geoff Kendrick, the bank’s global head of digital assets research, estimates that one-third of the current $301.4 billion stablecoin market capitalization could come out of U.S. bank deposits—roughly $100 billion.

Because stablecoin issuers largely hold reserves in Treasury bills rather than redepositing funds into the banking system, Kendrick argues that inflows represent a permanent drain on bank balance sheets. Tether holds just 0.02% of reserves in bank deposits, compared with 14.5% for Circle.

Regional banks are most exposed, according to the report, while larger institutions are more insulated. Kendrick projects the stablecoin market could reach $2 trillion by 2028, intensifying competitive pressure on traditional banks as regulated tokens like USA₮ gain traction.