Tether CEO: Circle Not Making Money Off Their Massive IPO

In early April, during a conversation in Cantor Fitzgerald’s swanky Manhattan office, Tether CEO Paolo Ardoino abruptly called a halt to the interview. The reason? He’d noticed a “strange message” on the laptop in front of him.

After twenty seconds of silence in the conference room, a broad smile appeared on Ardoino's face. There were reports that Circle, one of Tether's main competitors, might be putting the brakes on its long-awaited IPO would pull.

“People were not impressed with their financials and disclosures,” Ardoino said at the time. “They probably don’t make a profit.”

“It’s funny because I’ve been saying for a long time that they’re not making money,” the Tether CEO continued. “And people are like, ‘Oh, Paolo, you’re only saying that because you’re a competitor.’ But it’s clear.”

Two months later, Circle’s IPO has finally hit Wall Street—and the company is far from cash-strapped. On Thursday, the stablecoin issuer’s stock price more than tripled from its $31 IPO target price on its first day of trading, pushing the company’s valuation above $19 billion.

The excitement surrounding Circle's stock market debut was so great that the New York Stock Exchange had to halt trading in CRCL shares several times.

Tether is by far the world's largest issuer of stablecoins—digital assets that are typically pegged to the US dollar and allow holders to trade in and out crypto markets. This makes them a cornerstone of the sector.

The El Salvador-based company’s flagship stablecoin, USDT, currently has a market cap of over $153 billion. Circle’s closest competitor, Circle, maintains USDC, a dollar-based stablecoin with a circulating value of $61 billion.

Circle, based in the United States, is widely seen as a Tether competitor that is willing to adhere to strict financial regulations that the market leader may not. Tether has never undergone a full financial audit, and USDT has been delisted in jurisdictions such as the European Union, which has stricter requirements for stablecoin issuers.

As the United States attempts to create its own legal basis for issuing stablecoins, Tether has indicated it may develop a new token tailored to those requirements, while targeting its flagship USDT at emerging markets. Pending stablecoin proposals in Congress would require issuers to provide detailed, audited evidence of available reserves and comply with strict anti-money laundering measures required by the Bank Secrecy Act, among other requirements.

During the April call, the Tether CEO made it clear that there is little love lost between him and competitors like Circle. Ardoino dismisses claims from such companies about Tether’s alleged lack of compliance with financial regulations as untrue and unfair.

“They want to try to kill us,” he said. “Just to make a little more money.”

Ardoino also suggested that the choice of companies like Circle to embrace Wall Street may be short-sighted.

“It’s great for us,” the CEO said of the increasingly crowded market of stablecoin issuers. “Because every one of them is going to be focused on institutional adoption, and institutions are going to sell you out for a business point.”

Ardoino compared the efforts of competitors in his sector to catch up to Tether to a startup trying to build “a new Amazon” from scratch.

“Sure,” he said. “But we have the distribution that no one else has. It’s very hard to replicate now.”

Circles CEO Jeremy Allaire's personal wealth rose by nearly $2 billion on Thursday, based on the shares he owns.

This morning, the director made a celebratory post on X, celebrating Circle's stock market debut as a historic moment for him and his company.

“Since our founding, we have focused heavily on being trustworthy, transparent, compliant, ethical and well-governed,” Allaire said. “Meeting the high standards of NYSE and SEC regulations further reinforces those attributes.”

In the past few hours, analysts have been trying to explain why Circle has outperformed the stock market so much, taking many in traditional finance by surprise.

“It’s really driven by fervor around stablecoins and people who are vastly underexposed or sidelined in them,” Tom Dunleavy, a partner at investment firm Varys Capital, said of the current interest in the company. “You can’t invest in Tether.”

Frequently Asked Questions

What is Tether's main competitive model in the crypto market?
Tether competes primarily with Circle, the issuer of USDC, which is also pegged to the dollar as a stability model. Tether’s USDT has the largest market cap, but Circle positions itself as the more compliance-focused option with stricter oversight.

Why was Circle's IPO so successful?
Circle’s IPO exceeded expectations as its share price more than tripled, resulting in a market cap of over $19 billion. High demand for stablecoins and fear of missing out on Tether were major factors.

What are the implications of stricter regulations for stablecoins like Tether?
Tighter regulation could force Tether to restructure its business model or develop new tokens that meet the requirements. This could lead to greater transparency and compliance, especially in markets with strict regulations such as the EU.