Stuart Hoegner, General Counsel for Tether, Announces Retirement

Update (Jan. 3, 2024, 2:20 am UTC): This article has been updated to reflect that Stuart Hoegner’s retirement is a separate event from the implementation of MiCA and also adds related news about Tether.

Tether’s General Counsel Resigns Amid EU Regulatory Uncertainty

Stuart Hoegner, the general counsel of Tether and Bitfinex, has retired from his role as legal chief at the two firms. He will be replaced by Michael Hilliard, who has been working alongside Hoegner for several years.

In a January 2 statement shared with Cointelegraph, Tether wrote that Hoegner had retired and would be replaced as general counsel by Tether’s current legal counsel.

"Michael’s deep understanding of both companies’ operations, coupled with his strategic approach to legal and regulatory challenges, has been critical to advancing both Tether and Bitfinex’s mission," wrote the firm in the statement.

Uncertainty around USDT compliance in EU

The change in legal leadership for Tether comes amid the implementation of MiCA in Europe, which officially took effect on December 30. The MiCA regulations have left stablecoin issuers like Tether in limbo, with the rules not clearly stating whether the firm’s US Dollar-pegged stablecoin Tether (USDT) complies with the new EU crypto framework.

"No regulators have explicitly stated that USDT isn’t compliant, but this does not mean that it is," Juan Ignacio Ibañez, a member of the Technical Committee of the MiCA Crypto Alliance, told Cointelegraph in a December 29 report.

Tether’s Compliance Issues in EU

The European Securities and Markets Authority (ESMA) — a key supervisor of MiCA compliance — declined to tell Cointelegraph whether USDT was seen as a restricted stablecoin under MiCA. A spokesperson at ESMA then said that the regulator was working with market participants and other stakeholders to address stablecoin-related issues presented in MiCA.

While there has been murky guidance on the matter of Tether’s legal status in Europe, US crypto exchange Coinbase delisted USDT in mid-December, citing compliance with MiCA. Despite Coinbase’s move to delist USDT, the stablecoin has continued trading across the EU, with many exchanges still awaiting further clarity from European authorities on USDT’s compliance with MiCA.

Tether’s Market Cap Falls

USDT’s market cap fell from $138.8 billion on December 30, 2024, to a weekly low of $136.9 billion on January 1, CoinGecko data shows. It marked the USDT market cap’s biggest dip since the FTX collapse in November 2022. Its current market cap of $137.2 billion is 2.75% off its all-time high of $141 billion set on December 20, 2024.

Tether’s Market Cap Over the Last Week

Despite the fall, USDT stablecoin dominance still sits above 65% in what has become a $210 billion market.

Also on December 30, Tether moved almost $780 million worth of Bitcoin into its corporate Bitcoin reserve in its largest move since March. Tether said in May 2023 that it planned to "regularly allocate up to 15% of its net realized operating profits toward purchasing Bitcoin."

Regulatory Uncertainty and Its Impact on Tether

The implementation of MiCA has left stablecoin issuers like Tether in a state of uncertainty. The rules are not clear, and there is no explicit guidance on whether USDT complies with the new EU crypto framework.

However, it’s worth noting that the lack of explicit guidance from regulators does not necessarily mean that USDT is non-compliant. As Juan Ignacio Ibañez pointed out, "No regulators have explicitly stated that USDT isn’t compliant, but this does not mean that it is."

The Future of Tether in EU

The future of Tether in the EU remains uncertain. While some exchanges like Coinbase have delisted USDT citing compliance with MiCA, others continue to list it. The lack of clear guidance from regulators has left market participants in a state of uncertainty.

In conclusion, the retirement of Stuart Hoegner as general counsel of Tether and Bitfinex comes amid regulatory uncertainty in Europe. The implementation of MiCA has left stablecoin issuers like Tether in limbo, with unclear guidelines on compliance. As the situation continues to unfold, one thing is clear: the future of Tether in the EU remains uncertain.

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