EQIBank-Capstone Case Exposes Vulnerability in USDT's Banking System

The recent case involving EQIBank and Capstone has shed light on the intricate banking system behind the world's largest stablecoin, USDT.

The incident highlights the dependency of Tether's global dollar network on offshore banks, payment intermediaries, and major U.S. banks that form a bridge between the on-chain dollar and the traditional financial system.

EQIBank, an offshore bank based in Dominica, was involved in processing transactions related to USDT, while Capstone, a U.S. payments firm, acted as an intermediary in these transactions.

This case study exposes a critical vulnerability beneath Tether's global dollar network, revealing the importance of understanding the traditional financial system that underpins cryptocurrency transactions.