According to The Wall Street Journal, the US federal government is investigating whether Tether, the world’s largest stablecoin issuer, has violated sanction and anti-money laundering rules.
WSJ: US government investigating Tether
According to The Wall Street Journal, the US federal government is investigating whether Tether, the world’s largest stablecoin issuer, has violated sanction and anti-money laundering rules.
This criminal investigation is being led by prosecutors from the Manhattan US Attorney’s Office and aims to investigate whether cryptocurrencies have been used by third parties to fund illegal activities such as drug trafficking, terrorism, hacking, or to launder the proceeds of these activities.
Meanwhile, the Treasury Department has been weighing whether to impose sanctions on Tether, as the stablecoin USDT has been used by individuals and groups subject to US sanctions, including terrorist organization Hamas and Russian bad actors. The report states that if the Treasury Department decides to sanction Tether, the focus will be on preventing US individuals from engaging in business with Tether.
CEO Paolo Ardoino’s rebuttal
Tether CEO Paolo Ardoino responded on Twitter:
There is no evidence to suggest that Tether is under investigation. The WSJ is just recycling old news.
He also added that Tether regularly communicates with law enforcement officials to prevent rogue states, terrorists, and criminals from abusing USDT. If Tether were truly under investigation as claimed in the article, the company would definitely know about it, so the report is absolutely incorrect.
Tether’s battle with the media
Stablecoin leader Tether has always had numerous battles with major media outlets. Bloomberg raised many doubts about Tether’s reserve assets in October 2021 and published an article titled “Has Anyone Seen Tether’s Billions?” Bloomberg and CoinDesk have also demanded that the New York Attorney General’s office publicly disclose relevant information about Tether and reveal inconsistencies between the documents and Tether’s public statements. The Wall Street Journal has also had negative reports about Tether.
(Tether’s battle with the media! Documents reveal Tether’s reserve assets involving Chinese company securities)
Even Forbes published a special article about Tether in August 2023, questioning Tether’s apparent continuous growth but declining profits and accusing the company of using inconsistent indicators in its reports, maintaining its usual tactic of obfuscation.
(Chain News breaks down Forbes report on Tether: Declining profits, obfuscation with different indicators)
However, every time Tether faces media attacks, CEO Paolo Ardoino always comes forward to refute them, claiming that it’s just FUD (fear, uncertainty, and doubt). The market capitalization of USDT recently surpassed $120 billion, reaching a new historical high and accounting for 68% of the overall stablecoin market capitalization.