USDT Dominates Iranian Sanctioned Wallets, US Senate Requests Investigation
Written with artificial intelligence.
A recent report revealed that 84% of the 846 cryptocurrency wallets linked to Iran and related entities primarily used Tether (USDT). In response, the US Senate's Democratic investigation team has requested a review of Tether's compliance with sanctions and anti-money laundering obligations.
Investigation Findings
A report by the US Senate Democratic investigation team found that 84% of the 846 cryptocurrency wallets linked to Iran and other sanctioned entities predominantly utilized Tether (USDT). This analysis prompted the Senate to request a government investigation into Tether's adherence to sanctions and anti-money laundering regulations.
Senator Richard Blumenthal released the findings on September 28, presenting the report titled ‘Tethered to Terrorism: Crypto & Iran’s Shadow Banking Network.’ He sent letters to Treasury Secretary Scott Bence and Attorney General Todd Blanch to initiate the investigation. The analysis focused on blockchain transactions from the identified wallets, highlighting that USDT was used almost exclusively in these transactions.
The report also claims that Iran's unofficial financial networks use USDT to circumvent sanctions on banks, facilitating fund transfers related to groups like Hamas, as well as procurement of drones and military equipment. While the report called for an investigation, it does not imply that the government has commenced any legal proceedings against Tether or determined any violations of law.
Tether responded on the same day, stating that they supported the freezing of approximately $550 million in assets related to Iran's Central Bank and sanctioned wallets. According to Tether, over $344 million was frozen from two wallets in April, and more than $130 million from four wallets in July. Tether's CEO, Paolo Ardoino, emphasized that the company is open to taking action if provided with reliable information by law enforcement, asserting their capability to trace fund movements on public blockchains. This response addresses past criticisms regarding Tether's wallet freezing practices and their compliance with authorities' designations.