Tether, the issuer of the world’s largest stablecoin by market capitalization, has invested in Zengo Wallet, a self-custodial cryptocurrency wallet, as its USDt stablecoin faces regulatory challenges in the European Union.
Tether has completed a strategic investment in Zengo Wallet, a self-custodial wallet focused on multiparty computation (MPC) technology, according to an announcement shared with Cointelegraph on Feb. 11.
The undisclosed investment will help Zengo enhance its wallet features, enabling “seamless support for Tether’s stablecoins across major blockchain ecosystems,” the announcement stated.
“Tether is committed to delivering reliable and secure tools that empower users to take control of their digital assets. Our investment in Zengo reflects that commitment,” Tether CEO Paolo Ardoino said.
Zengo eliminates seed phrase vulnerability
Launched in 2019, Zengo operates a self-custodial cryptocurrency wallet that eliminates the need for traditional seed phrases.
According to the announcement, the wallet has served more than 1.5 million users worldwide “without a single wallet being hacked, phished, or taken over.”
Zengo says it uses MPC cryptography instead of seed phrases or private keys. Source: Zengo
“By supporting Zengo’s innovative approach to self-custody, we aim to help more people worldwide access blockchain technology with confidence, ease, and security. Together, we are shaping the future of how stablecoins are used and adopted,” Ardoino said.
Tokens like USDT cannot be restricted from self-custody
Tether’s investment in Zengo comes amid its USDt stablecoin facing increasing regulatory pressure in the EU, with many exchanges delisting the stablecoin to comply with the Markets in Crypto-Assets (MiCA) framework.
Ardoino previously expressed disappointment over crypto regulation developments in Europe, warning of potential risks of a “disorderly crypto market” in the EU.
While stablecoins like USDT can be restricted by centralized crypto exchanges, self-custodial wallets like Zengo allow users to store their tokens freely, with some industry execs saying that such wallets are unbannable.
Related: Tangem wallet secures US patent for private key transfer tech
As self-custodial wallets enable users to “be their own bank,” many financial regulators and banking institutions have expressed concerns over the potential risks behind such tools.
In November 2024, the central bank of Brazil proposed to ban stablecoin transactions to self-custodial wallets like MetaMask. According to the community, such a move would only trigger a further shift to decentralization.
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Tether, the issuer of the world’s largest stablecoin by market capitalization, has invested in Zengo Wallet, a self-custodial cryptocurrency wallet, as its USDt stablecoin faces regulatory challenges in the European Union.
Tether has completed a strategic investment in Zengo Wallet, a self-custodial wallet focused on multiparty computation (MPC) technology, according to an announcement shared with Cointelegraph on Feb. 11.
The undisclosed investment will help Zengo enhance its wallet features, enabling “seamless support for Tether’s stablecoins across major blockchain ecosystems,” the announcement stated.
“Tether is committed to delivering reliable and secure tools that empower users to take control of their digital assets. Our investment in Zengo reflects that commitment,” Tether CEO Paolo Ardoino said.
Zengo eliminates seed phrase vulnerability
Launched in 2019, Zengo operates a self-custodial cryptocurrency wallet that eliminates the need for traditional seed phrases.
According to the announcement, the wallet has served more than 1.5 million users worldwide “without a single wallet being hacked, phished, or taken over.”
Zengo says it uses MPC cryptography instead of seed phrases or private keys. Source: Zengo
“By supporting Zengo’s innovative approach to self-custody, we aim to help more people worldwide access blockchain technology with confidence, ease, and security. Together, we are shaping the future of how stablecoins are used and adopted,” Ardoino said.
Tokens like USDT cannot be restricted from self-custody
Tether’s investment in Zengo comes amid its USDt stablecoin facing increasing regulatory pressure in the EU, with many exchanges delisting the stablecoin to comply with the Markets in Crypto-Assets (MiCA) framework.
Tether CEO Ardoino previously expressed disappointment over crypto regulation developments in Europe, warning of potential risks of a “disorderly crypto market” in the EU.
While stablecoins like USDT can be restricted by centralized crypto exchanges, self-custodial wallets like Zengo allow users to store their tokens freely, with some industry execs saying that such wallets are unbannable.
Related: Tangem wallet secures US patent for private key transfer tech
As self-custodial wallets enable users to “be their own bank,” many financial regulators and banking institutions have expressed concerns over the potential risks behind such tools.
In November 2024, the central bank of Brazil proposed to ban stablecoin transactions to self-custodial wallets like MetaMask. According to the community, such a move would only trigger a further shift to decentralization.
Magazine: Justin Sun reignites HTX feud, India reconsiders crypto hate: Asia Express