Why doesn't the United States ban stablecoins? Why was USDT legalized?

Why aren't stablecoins banned in the United States? And on the other hand, they are fully approved! After all, the USA usually likes to control everything!

Imagine a currency that does not drop by 50% per day, as Altcoins do. And yes, these are stablecoins. These are digital dollars that always cost exactly $1.

How does it work?

For example, Tether takes a real dollar, puts it in a bank (or buys US bonds) and issues 1 USDT or USDC token (these are two different stablecoins).

In fact, at the exit we get the same dollar, but in a crypto package: fast, cheap in transfers and not tied to banking hours.

In other words, you don't have to wait for the bank to open to transfer money abroad. Everything comes instantly, literally in seconds or minutes!

Why doesn't the US ban stablecoins?

But why does the United States not ban them, but rather even allow and approve their work? After all, in the USA they usually like to control everything.

The secret is that these coins have become huge buyers of the American national debt.

For example, Tether (USDT) holds over $127 billion worth of U.S. bonds.

It turns out an ingenious scheme:

1. A user from any part of the world wants to buy a stable coin
2. He buys USDT / USDC / or other stable coins (USDT is the most popular)
3. Then, for example, Tether buys US bonds with these dollars
4. This strengthens the dollar and lends money to the United States

The United States even passed the Genius ACT, which officially recognized stablecoins.

What is the GENIUS Act? 

The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins) is a proposed U.S. federal law. Its goal is to create a clear set of national rules for stablecoins.

The Act requires that stablecoins be backed 1-to-1 by U.S. dollars or other low-risk assets. It sets strict standards for what counts as a proper reserve, how audits should be done, and requires transparency for buyers.

Before this Act, stablecoins did not legally have to be backed 1-to-1 by low-risk assets. The GENIUS Act is an early step toward creating a system with both federal and state oversight and consumer protections.

Criticism of the Law

• Consumer Reports, a consumer advocacy group, argues the bill doesn't do enough to protect consumers. They say it could allow big tech companies to act like banks without having to follow the stricter rules that banks must follow.

• The New York Attorney General and other state prosecutors have pointed out that the law lacks rules forcing stablecoin companies to return money stolen from victims. They argue this could let these companies keep profits made from fraud and make it harder for law enforcement to fight crime.

What if stablecoins are lying?​

The main vulnerability of stablecoins is trust in the issuer. Tether (USDT) has been at the center of scandals more than once: the company has been accused of having real dollar reserves that do not match the volume of coins issued (that is, there are no 1:1 reserves).

Although Tether currently publishes reports, they are not audited by the Big Four companies (PwC, Deloitte, etc.), which leaves doubts about full transparency and honesty.

There is a chance that reserves may not be 1:1 even after the reports are published!

Global competition for stablecoins pegged to the dollar

The US is betting on private stablecoins pegged to the dollar to strengthen its global dominance.

However, other centers of power see this as a threat to their sovereignty and promote alternatives:

• Europe – introduces strong regulation and its own digital Euro
• China - fully controlled, own state-owned digital currency

Stablecoins have become not just a financial instrument, but an arena of geopolitical struggle.

The United States uses them to prolong the life of the dollar, Europe builds barriers, and China builds its own completely closed system.

The role of Stablecoins in DeFi

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In the world of cryptocurrencies, stablecoins serve as a "digital cache."

Traders and investors use them not for transfers abroad, but for daily work within the crypto ecosystem itself.

This is the basis of the entire decentralized financial system (DeFi), where without a stable coin it is impossible to lend, trade or generate returns.

Besides the dollar, what else are stablecoins backed by?

Interesting fact. Few people know, but stablecoin issuers are diversifying their reserves.

For example, Tether is buying gold at such a pace that it has already accumulated 140 tons, which is more than the reserves of some central banks and is worth about $24 billion.

They store it in ultra-secure vaults, like bank vaults.

Conclusion

The United States does not ban stablecoins because they have become a financial instrument that prolongs the life of the dollar in the world. This is a business that benefits everyone.