Stablecoin giant Tether is moving to Bitcoin-friendly El Salvador.
The company—currently incorporated in the British Virgin Islands—announced Monday that it had acquired a Digital Asset Service Provider license in the country and was relocating all its subsidiaries to the Central American nation.
Tiny El Salvador made Bitcoin legal tender in 2021 in a bid to get its citizens to use the biggest cryptocurrency by market cap. Under its leader, President Nayib Bukele, the country is also trying to attract tech entrepreneurs.
“By rooting ourselves [in El Salvador], we are not only aligning with a country that shares our vision in terms of financial freedom, innovation, and resilience but is also reinforcing our commitment to empowering people worldwide through decentralized technologies,” Tether CEO Paolo Ardoino said in a statement.
Monday’s announcement added that the country had a “favorable regulatory environment.” Tether did not immediately respond to Decrypt’s questions.
Tether is the company behind USDT, the most-traded cryptocurrency. With a market cap of $137 billion, it is also the fourth-biggest digital asset by that metric.
USDT is the biggest stablecoin, a digital asset designed to hold a stable value—unlike Bitcoin or Ethereum—by having reserves of stable assets. In Tether’s case, USDT is backed by U.S. dollars, treasuries and other assets.
In the world of crypto, Tether’s USDT is massively important: Traders use it to enter and exit trades instead of relying on banks.
But Tether is a controversial company. Regulators have opened investigations into—and even sued—the firm for allegedly not being transparent enough about what backs its reserves.
The company has said it is open to being independently audited by one of the Big Four accounting firms.
El Salvador—apart from being Bitcoin-friendly—has gone from being one of the most murderous places on the planet to an aspiring digital nomad tech paradise. President Bukele uses the country’s coffers to buy Bitcoin and has more or less defeated the nation’s once-infamous street gangs.
But despite being popular with the country’s citizens, NGOs have criticized Bukele for alleged human rights abuses—and for imprisoning 2% of the country’s population in a mega jail.
But the move to attract crypto businesses may be working out: Just last week, crypto exchange Bitfinex announced that its derivatives arm would relocate to El Salvador.
Edited by Andrew Hayward
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Source: https://decrypt.co/300657/stablecoin-issuer-tether-relocates-bitcoin-friendly-el-salvador
