The SEC announced on April 4th banks operating Dollar-backed stablecoin platforms like Tether USDT and Circle USDC maintain their autonomy due to the tokens not qualifying as securities under Securities and Exchange Commission oversight.
According to the Securities and Exchange Commission’s written update on Friday, April 4, stablecoins connected to dollars through cash accounts do not require securities laws compliance. The statement simplifies registration rules for people who create and transform stablecoins.
Securities And Exchange Commission Defines Token Compliance
The Securities and Exchange Commission confirms that crypto tokens created as payment methods, money transfer services, and virtual assets fall under this category. This new guideline does not cover algorithmic stablecoins which use programmed code to regulate token supply yet keep drawing regulatory attention since the Terra UST crash in 2022.
The action supports growing congressional legislation since the Stable Act of 2025 and the GENIUS Stablecoin Bill want to make rules about stablecoin operations. In February 2023 Senator Bill Hagerty presented laws that would regulate fiat-backed stablecoins under Federal Reserve control to maintain global dominance for the U.S. dollar.
Primary support comes from U.S. dollar reserves and short-term Treasury bills that make USDT and USDC essential digital asset components. The cryptocurrency USDT dominates as the largest stablecoin because its market value now stands at more than $144 billion and ranks third among all cryptocurrencies globally.
The Securities and Exchange Commission announcement helps stablecoins based on money reports gain support which lets bigger businesses invest more in cryptocurrency markets alongside keeping algorithmic tokens under review.
