Tether's U.S. stablecoin push is getting a direct challenge from Circle, its key rival, with Jeremy Allaire saying USAT has almost no activity while comparing Tether's broader business to a "macro hedge fund."
Jeremy Allaire, CEO of Circle, the company behind USDC, said during a May 28 Bernstein conference appearance that USAT, Tether's separate U.S.-market stablecoin issued through Anchorage Digital Bank, has little use so far, according to a transcript published by Seeking Alpha.
Allaire said Tether had "experimented" with USAT, which he said has about "$20 million in circulation" and "basically zero transaction volume."
The comments came after Bernstein analyst Gautam Chhugani asked Allaire how Circle views Tether's move into more compliance-driven U.S. stablecoin products.
- Tether, the issuer of USDT, the world's largest stablecoin, unveiled USAT in September 2025 as a dollar stablecoin built for U.S. users.
- The company added that former White House official Bo Hines would lead the venture.
- The product is separate from USDT, Tether's main offshore dollar-pegged stablecoin, which has a market capitalization of more than $188 billion, according to CoinGecko data.
- USAT is issued by Anchorage Digital Bank, a federally chartered crypto bank. Cantor Fitzgerald was named as custodian and preferred primary dealer when Tether announced the product.
The Circle CEO also questioned USAT's distribution, pointing to what he described as "a distribution deal with a video stream site I think it's like a social network video site as a wallet," referring to Rumble Wallet, a non-custodial crypto wallet created by video platform Rumble in partnership with Tether.
"I have not seen that anywhere in the institutional market, but it is an experiment for sure," Allaire added.
Similar to a macro hedge fund
Allaire's broader criticism was also aimed at Tether's offshore business model. He said Tether looks less like a fully regulated payment network and more like what he called "a macro hedge fund" connected to a stablecoin network since it holds assets such as Bitcoin and gold and also makes loans.
Jeremy Allaire
One explanation for USAT's limited traction may be timing. USAT is being pitched around the GENIUS Act, the U.S. stablecoin law signed by President Donald Trump in July 2025.
Those rules take effect on the earlier of mid-January 2027 or 120 days after federal regulators issue final implementing rules, as American law firm Chapman and Cutler explained earlier.
So, even though Tether can build USAT around the new rules now, given that the final U.S. stablecoin framework still isn't fully in place, the rollout may stay limited.
As of press time, neither Tether nor CEO Paolo Ardoino has publicly responded to Allaire's comments. The Coinformer reached out to Tether for comment and will update the story if we hear back.