USDT has entered the last two years of its U.S. compliance countdown. Under the three-year transition window created by the GENIUS Act, Tether must complete compliance by Jan. 18, 2028, or USDT will no longer be allowed to trade on U.S. platforms.
CoinDesk reported on July 19 that Tether CEO Paolo Ardoino said plainly that “Tether will comply with the GENIUS Act.” The company’s chosen path, though, is not to place USDT itself inside the law’s permitted issuer structure. Instead, Tether is advancing USA₮, a token built for the U.S. market, while keeping USDT on a foreign issuer track.
The GENIUS Act sets a three-year transition window
The GENIUS Act was signed into effect by Trump on July 18, 2025, and established a three-year transition period. The law requires any stablecoin issuer that wants its token to circulate on U.S. platforms to register as a “permitted payment stablecoin issuer” by Jan. 18, 2028.
The core requirements listed in the article are:
- 1:1 reserves
- Holdings limited to cash and U.S. Treasuries, described as HQLA
- Monthly reserve attestations by an independent accountant
- Federal or state supervisory review
- No interest payments
The law also gave seven federal agencies one year to publish final rules: the OCC, FDIC, Federal Reserve, NCUA, FinCEN, Treasury, and OFAC. If those rules are issued on schedule, issuers would then have another 120 days of buffer time.
In practice, the piece notes that the July 18 deadline for those agencies has already passed, while most of the rules are still at the public comment stage, citing a July 19 report from Chain News.
Tether is sticking with a two-token strategy
Ardoino’s public position has been consistent. USDT will not leave the U.S., but it also will not register as a permitted issuer under the GENIUS Act.
Tether’s plan breaks down into two tracks:
- USDT would follow a foreign issuer route and continue serving markets outside the United States, including emerging markets, cross-border payments, and centralized exchange trading
- USA₮ would serve as a dedicated U.S. product and was issued in January 2026 through Anchorage Digital Bank to fit directly within the GENIUS Act framework
Ardoino did not answer CoinDesk’s questions about Tether’s specific compliance progress.
That leaves a practical question unresolved. After 2028 begins, whether USDT can remain listed on U.S. exchanges such as Coinbase, Kraken, and Gemini will depend largely on how regulators interpret the boundary between the foreign issuer safe harbor and use by U.S. persons.
USDT’s reserve mix does not match the act’s standard
A major reason Tether is not moving USDT directly into the permitted issuer structure is its reserve composition.
According to the article, about 25% of Tether’s current reserves are in assets that would not qualify under the GENIUS Act. Those assets include precious metals, secured loan exposure, and Bitcoin. The law’s requirement for a permitted issuer is 100% backing in cash and U.S. Treasuries.
To bring that 25% portion into a compliant structure, Tether would need to redeem or rotate those holdings in full. The article says that would hit the company’s profit model hard because loan exposure and BTC positions are major sources of non-interest income.
This is presented as the central reason behind Tether’s two-token approach. The company can leave USDT’s reserve structure intact while issuing a separate, cleaner product for the U.S. market.
USA₮ has been live for six months, but usage remains low
USA₮ was issued in January 2026 through Anchorage Digital Bank. The article describes it as Tether’s stablecoin built specifically for a GENIUS Act environment, with full cash and U.S. Treasury reserves, monthly audits, and issuance through a federally regulated U.S. bank.
Even so, actual usage has remained low over its first six months. CoinDesk cited Anchorage Vice President Kevin Wysocki as saying, “When the safe harbor expires in 2028, non-compliant stablecoins won’t be able to be used by U.S. institutions.”
The weak adoption is not hard to explain. USDT already has entrenched use across DEX liquidity, CEX listings, and cross-border payment channels. There is little reason for users to migrate on their own. A more urgent incentive would appear only if U.S. exchanges were forced to delist USDT.
Europe offers a reference case under MiCA
The article says the U.S. is not the first market where USDT has faced this kind of pressure. After the European Union’s MiCA rules took effect, major exchanges including Binance, Kraken, Coinbase EU, and Crypto.com removed USDT spot pairs for European users between late 2024 and 2025.
Tether did not apply for MiCA authorization in Europe and took what the article describes as a strategy of not exiting but not becoming compliant. European users then shifted toward MiCA-compliant stablecoins such as USDC and EURC.
Market share in the U.S. may depend on regulatory interpretation
If the U.S. follows a similar path, USDT’s share of the American market could be split among USDC, PYUSD, and Tether’s own USA₮.
The report adds that regions with heavy USDT use, including Taiwan, Southeast Asia, and Latin America, are not expected to face a direct impact from the 2028 deadline itself. Still, if U.S. exchanges are forced to delist USDT, the token’s global liquidity hubs, including Binance US and Coinbase, would be affected, and that could indirectly lift USDC usage in Asian markets.