Source: Anthony Pompliano Podcast; Organized by: Felix, PANews

Bo Hines, CEO of Tether USAT (Tether’s U.S.-regulated, U.S. dollar-backed stablecoin), is also a former White House cryptocurrency adviser who helped shape U.S. digital asset policy during a critical period in the industry’s development.

Recently, Bo Hines was interviewed at the Bitcoin Investor Week in New York. During the conversation, he disclosed the details of the cryptocurrency policy work he participated in in the White House, and discussed topics such as the popularity of stable coins and why user experience is more important than revenue.

PANews has compiled the highlights of the conversation. The following are the content details.

Moderator: You have served in the White House and are now the CEO of Tether USAT. When I think about your importance in the crypto industry, there are a few big things I can relate to you. One of them is that you promoted the completion of the Bitcoin strategic reserve. You've secured a lot of "transparency" (pun intended, referring to the Clarity Act) on the current administration's encryption policies. Talk about your time in the White House responsible for crypto affairs, and when you left to join Tether, how did you view what you had accomplished?

Bo Hines: It was a great time. With David's involvement, we made it our mission to move forward at "tech speed" (fast), and I feel like we achieved it. Patrick was deputy at the time and now takes over my previous position. We work at lightning speed trying to get as much done as possible. Given the nature of political cycles, we felt we had to capture the momentum early, and we did. The biggest question at the time was: Which bill to move forward first? It was a debate between the Genius Act and the Clarity Act.

Obviously, we succeeded in getting the Genius Act passed last July, but the debate over the Clarity Act continues. We completed the establishment of the Strategic Bitcoin Reserve via executive order, in addition to the release of the President’s Digital Assets Task Force Report, the most comprehensive digital asset regulatory framework ever created.

With the Genius Act, stablecoin regulation gives us the access we need to achieve the coveted 24/7 market. I enjoyed my stay there. After the Genius Act passed, I felt it was time to leave. I was kind of the bulldozer on that bill, so it would be good to have a new face for the next phase. After the bill was released, I decided to step back, which led to me becoming the CEO of USAT now.

Moderator: When it comes to the Clarity Act, everyone is concerned about whether it will be passed. Yesterday someone said the probability of passing was 60%. How important is this to the industry? How can everyone live well if they don’t pass?

Bo Hines: I think it's extremely important. It is the final piece of the puzzle that completes the overall picture. I think the chance of passing is somewhere between 80% and 90%. Now there are only a few small details left to iron out, with the biggest disagreement being over the user experience (UX) structure.

The media has been talking about the yield battle between banks and crypto natives. I really feel that this is not a battle for revenue, but a battle for user experience. That is, do you have to be a bank chartered by the OCC (Office of the Comptroller of the Currency) and do you have to have a separate platform to pass the benefits on to customers. This actually only involves one participant in the industry. Now that most people in the crypto space have reached consensus and banks are starting to realize that the popularity of stablecoins is a reality, integration is about to begin. I trust David and Patrick to find the perfect balance.

Host: Let’s talk about USAT and what you are doing.

Bo Hines: Tether is undoubtedly an important player in the crypto ecosystem. We now have about 530 million customers, growing about 30 million every quarter. We are the 13th largest holder of gold in the world. At the same time, Tether is also a firm Bitcoin Maxis. It's a very unique company: just 300 employees and 2025 profits of $10 billion. In the new world set by the Genius Act, we decided to launch a U.S. stablecoin product that meets the Genius Act standards to serve institutions.

Our goal is to leverage these 530 million global users to connect emerging markets with U.S. capital markets. Tether is not only a stablecoin company, but also an active investor in the technology field, with investments ranging from robotics to infrastructure. For those who deeply love Bitcoin, the integration of stablecoins is a huge benefit, because it provides a channel for deposits and withdrawals, allowing people to buy and sell assets such as Bitcoin more efficiently.

Moderator: To say that Tether is a major technology investor is an understatement. Every time I talk to Paulo, I get the latest updates about the BCI company and various other projects. Could you please briefly describe what are the benefits of establishing these channels? What goals do U.S. agencies currently have that they cannot achieve because of technology gaps? Or, how do you market these lanes to these institutions?

Bo Hines: Moving money around the U.S. is still very inefficient. Our payment channels are 95% more efficient than the rest of the world, but are not very cost-effective and have limited time windows for large transfers.

The adoption of stablecoins will completely change all of this. From a settlement perspective, whether it is intra-bank or inter-bank settlement, this allows banks in South Korea, for example, to still participate in the U.S. capital market on Friday afternoon (after the close) because of the settlement mechanism.

The competition now is infrastructure. You have to build a blockchain that can support this scale and be cheap. The adoption of stablecoins on the institutional side can save costs for banks and merchants. The settlement cycle changes from T+2, T+1 to T+0.

For consumers, it is an excellent remittance tool. In the future you may see payroll companies paying salaries directly in stablecoins. You can set it programmatically: 10% of your daily salary is automatically sent to Latin America or Asia. Our goal is to significantly change this cost structure in the coming years.

Moderator: Let’s talk about the benefits of stablecoins. There are many debates and trade-offs.

Bo Hines: Tether remains neutral on the issue of returns. Because our business model does not rely on distributing income, we provide the deepest liquidity and the best distribution capabilities. Our market capitalization is approximately $185 billion.

The crux of the matter is: Can you be a broker, an exchange and a bank at the same time? Some call it “shadow banking,” which is why the banking industry is starting to get nervous and want to protect its territory. The solution is simple: get an OCC license. This way you can share revenue with your customers just like a bank. The OCC is currently moving very quickly in issuing banking charters to crypto-native companies.

Moderator: What other financial services do you plan to provide to these 530 million users?

Bo Hines: I think there will be large-scale integration of public chains and stablecoins in the next 5 to 10 years. Tether is developing a WDK (Wallet Development Kit). We believe that it is extremely important to understand the customer's deposit channels. You will see all kinds of financial services packaged into these wallets. Tether’s mission for the past seven years has been to provide access to financial instruments to those who do not have direct access to them.

Moderator: You mentioned again that you are Bitcoin minimalists. Specifically, how does Tether support Bitcoin?

Bo Hines: We love Bitcoin. Bitcoin is part of our reserves. We are deeply involved in Bitcoin mining, trading and ecological construction. Stablecoins are the “first step” for people to come into contact with Bitcoin. Once users are familiar with on-chain transfers, they will often choose Bitcoin as their first choice for investment in the next step. With the popularity after the Genius Act, stablecoins will become the starting point for people to enter the world of digital assets. We’ve already seen Bank of America allow its wealth managers to allocate Bitcoin positions to clients, and mass adoption is just beginning.

Moderator: What is Tethe’s transparency and reserve?

Bo Hines: Tether’s reserves are currently mainly composed of U.S. debt, gold and Bitcoin. Tether is currently the 17th largest holder of U.S. debt in the world (including all sovereign countries) and plans to enter the top 10 this year. We are increasing the proportion of U.S. Treasuries in our reserves to meet Genius Act compliance standards.

Host: What worries do you have about the future?

Bo Hines: Privacy issues. This is what users crave, but regulations also need to be met. How to protect privacy while utilizing this technology will be an important topic in the next few years.

Moderator: What are the differences and synergies between USAT and the international version of Tether?

Bo Hines: Our goal is to achieve product interoperability. The international version of Tether (USDT) is the issuer, while the US product (USAT) is issued through Anchory Digital Bank, a US bank fully regulated by the OCC.

The two reserves are separate, but we can use technical means to make users feel seamless. Whether through the issuer or the exchange’s liquidity pool, we are confident that this cross-border will be smooth and frictionless.