Tether's Growing Influence Exposes Stocks to Regulatory Risks

The financial and crypto markets are abuzz as Tether's massive holdings of gold and US government debt, along with its growing influence in the UK, bring stablecoins to the forefront of regulatory debates. This mix of attention, scrutiny, and competition between major markets can create both opportunities and challenges for related stocks. Three companies, BlackLine (BL), DLocal (DLO), and GB Group (LSE:GBG), are particularly exposed to these developments.

BlackLine is a cloud software company that automates time-consuming accounting tasks, such as account reconciliations and journal entries, for large and mid-sized businesses. The firm generates around $716.7 million in revenue from its Software & Programming solutions, with roughly $490.6 million coming from the US and $226.1 million from international customers.

BlackLine's Agentic Financial Operations Platform and Verity AI are designed to help enterprises maintain tight control over automated workflows, which could become more important if stablecoin-related scrutiny grows. Analysts expect strong earnings growth and higher future returns on equity, but the stock is priced on a rich P/E ratio and has relied on external funding, making execution and balance sheet discipline crucial.

DLocal, an Uruguay-based payments company, helps global merchants accept and send money in emerging markets through its single platform. The firm generates around $1.21 billion in revenue from payment processing, serving merchants across Brazil, Mexico, Argentina, and other Latin American countries.

DLocal operates at the intersection of stablecoins, emerging market payments, and tighter oversight of digital assets, an area where regulators and large merchants are focusing their attention after Tether's growing influence. Earnings growth has been strong, returns on equity are high, but margins have softened, and all liabilities come from external funding.

GB Group provides identity verification, fraud detection, and location intelligence to banks, fintechs, crypto platforms, and other regulated industries. The firm generates around £175 million from Identity solutions, £88.5 million from Location services, and £21.6 million from Global Fraud Solutions.