Tether Addresses Requests for Intervention from U.S. Legislators
Tether, the company behind the stablecoin Tether (USDT), recently released letters to U.S. legislators in response to requests for intervention by the Department of Justice regarding the illicit use of its stablecoin.
Commitment to Fighting Illicit Use of Stablecoins
The letters, sent to members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs and the U.S. House Financial Services Committee, detail Tether’s commitment to combating the illicit use of stablecoins.
Lawmakers’ Concerns About Terrorism Financing
The communications were prompted by concerns expressed by Senator Cynthia Lummis and Representative French Hill after a coordinated attack by Hamas against Israel, which they suggested was supported in part by illicit crypto transactions providing terrorism financing.
Tether’s Response and Measures
Tether responded by highlighting its Know Your Customer (KYC) program, transaction monitoring system, and proactive approach to identifying suspicious accounts and activities. The company stated that it has always assisted law enforcement and remains committed to working with agencies globally.
Surveillance Tools and Wallet-Freezing Policy
Tether also mentioned that it uses surveillance tools such as Reactor from Chainalysis to track client activity on the blockchain. Additionally, the company announced a voluntary wallet-freezing policy to freeze activity associated with sanctioned individuals on the OFAC SDN List.
Shift in Strategy
In a change of approach, Tether decided to proactively freeze wallets associated with irregular activities due to increased scrutiny of crypto firms in the U.S. and worldwide. Tether aims to be a reliable partner to the U.S. and assist law enforcement while expanding dollar hegemony globally.
Hot Take: Tether’s Response to U.S. Legislators’ Concerns
Tether has addressed concerns raised by U.S. legislators regarding the illicit use of its stablecoin. The company emphasized its commitment to combating the misuse of stablecoins and highlighted its measures, including a KYC program and transaction monitoring system. Tether also mentioned its use of surveillance tools to track client activity on the blockchain. In response to increased scrutiny, Tether implemented a voluntary wallet-freezing policy and aims to be a trusted partner to the U.S. while expanding dollar hegemony globally. This move comes as the market share of USDT stands at $90 billion, demonstrating its significance in the crypto market.
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