Tether Under Scrutiny: USDT Stablecoin Faces Prolonged Investigation
Tether, the company behind the popular USDT stablecoin, is facing a prolonged investigation by the Manhattan District Attorney's Office. The probe, which began around 2019, is examining potential illegal activities involving USDT and the company's reserves.
Tether CEO Paolo Ardoino has dismissed the investigation, asserting that the company is cooperating with law enforcement to prevent misuses of USDT. However, cybersecurity expert Justin Bons has criticized Tether for lacking transparency regarding its reserves, drawing parallels with the now-collapsed crypto exchange FTX.
Prosecutors are exploring whether USDT has been employed in illicit activities such as terrorism financing, drug trafficking, and cybercrime. Meanwhile, Tether has assisted over 145 law enforcement agencies in 40 jurisdictions, aiding in the recovery of more than $108.8 million in USDT since its inception in 2014.
US authorities are also investigating Tether for potential violations of sanctions and anti-money laundering regulations. The US Department of the Treasury is reportedly considering sanctions against Tether for the use of its stablecoin by individuals under US sanctions.
The ongoing investigation into Tether and its USDT stablecoin highlights growing regulatory scrutiny of the crypto industry. While Tether maintains cooperation with law enforcement, critics call for greater transparency. The outcome of these investigations may have significant implications for the stablecoin market and the broader cryptocurrency sector.
