On Wednesday, JPMorgan (JPM) published a research note cautioning stablecoin giant Tether that it might be compelled to sell some of its Bitcoin (BTC) holdings to align with pending U.S. stablecoin legislation. Tether CEO Paolo Ardoino responded on Thursday with a sharp rebuttal on X, accusing JPMorgan analysts of being “salty” because “they don’t own Bitcoin.”
JPMorgan’s Compliance Assessment
According to reporting from The Block, JPMorgan analyzed Tether’s reserves against two proposed bills: the House’s STABLE Act (Stablecoin Transparency and Accountability for a Better Ledger Economy) and the Senate’s GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins). The bank estimated that 66% of Tether’s $144 billion in reserve assets would be compliant under the STABLE Act, while 83% would satisfy the GENIUS Act. Analysts suggested Tether would need to replace some Bitcoin holdings with traditional assets such as U.S. Treasury bills.
Tether dominates about 62% of the $230 billion stablecoin market with its flagship token USDT. The firm posted a massive $13 billion profit for fiscal year 2024 and currently holds approximately 84,000 BTC in one of its primary addresses.
Ardoino’s Blunt Response
“JPM analysts are salty because they don’t own bitcoin,” Ardoino posted on X. “Tether analysts say that JPM does not have enough bitcoin,” he added, referencing JPMorgan CEO Jamie Dimon’s 2017 remarks calling Bitcoin a “fraud” and threatening to fire employees who traded it. Dimon later softened his stance but remains personally uninterested in the cryptocurrency.
Ardoino also pointed out that JPMorgan’s analysis failed to account for Tether’s $20 billion in group equity, which generates over $1.2 billion in quarterly profits. Regarding the STABLE and GENIUS Acts, he said compliance “will be straightforward.”
Market Implications
The warning comes as U.S. lawmakers accelerate efforts to regulate stablecoins. Both bills require issuers to hold high-quality, liquid assets. If Tether must adjust its reserves, it could create short-term selling pressure on Bitcoin. However, Ardoino’s confidence stems from Tether’s robust financial position: beyond its crypto holdings, the company holds substantial cash, Treasuries, and other assets. Its quarterly profit of $1.2 billion provides a buffer against potential regulatory changes.
Still, some analysts warn that forced Bitcoin liquidation—even if unlikely—could roil markets. Tether’s Bitcoin stash alone is worth about $8 billion at current prices. The company has historically been opaque about its reserves, though it has improved disclosures in recent years. Ardoino’s dismissive tone suggests Tether expects to comply without major disruption, but the final regulatory text remains uncertain.
As of press time, Bitcoin traded at $96,500, down 0.8% in 24 hours. Market participants are watching for developments in the STABLE and GENIUS Acts, as well as any changes to Tether’s reserve composition in the coming months.