Tether CEO Paolo Ardoino has denied reports that lawmakers have investigated the leading cryptocurrency company over potential violations of anti-money laundering laws and sanctions.
The investigation, led by Manhattan prosecutors, focuses on whether Tether’s cryptocurrency (USDT) was used to finance illegal activities, such as drug trafficking or terrorism, or to launder money from these activities, according to the Wall Street Journal.
At the same time, the US Treasury Department is considering imposing sanctions on Tether, according to the WSJ.
The sanctions could prevent Americans from doing business with the company, primarily because its cryptocurrency has allegedly been used by sanctioned individuals and groups, including Russian arms dealers and the terrorist group Hamas.
Tether CEO Paolo Ardoino vehemently denied the reports, posting on X: “As we told the WSJ, there is no indication that Tether is under investigation. The WSJ is regurgitating old noise. Complete stop.”
Past reviews of Tether
In September, Consumers’ Research released a report criticizing Tether, the issuer of the USDT stablecoin, for its lack of transparency and failure to conduct a full audit of its dollar reserves, despite promises dating back to 2017.
The report compares Tether’s operations to those of the collapsed FTX and raises concerns about its alleged use to circumvent international sanctions, particularly in countries like Venezuela and Russia.
Tether’s cryptocurrency, known as a stablecoin, is pegged to the value of the US dollar, unlike more volatile cryptocurrencies like Bitcoin. This stability makes Tether popular in regions where access to the US dollar is restricted or prohibited.
No less than $190 billion worth of tether is traded worldwide every day, making it the most widely used cryptocurrency in the world.
Although Tether has denied involvement in illegal activities, the company has taken steps to prevent the misuse of its currency, including partnering with companies that track transactions.
