Tether Accused of Facilitating Iran's Shadow Banking Network

A Senate report has sparked controversy in the crypto space after alleging that Tether's USDT stablecoin plays a central role in Iran's shadow banking network. The report, titled 'Tethered to Terror: Crypto & Iran's Shadow Banking Network,' examines 846 sanctioned crypto addresses and claims that USDT is used by Iranian entities to facilitate illicit activities.

The Senate subcommittee believes that Tether is too slow to freeze assets linked to sanctioned entities, providing a 'permissive environment' for illicit activity. However, Tether has pushed back against these allegations, pointing out that it has frozen nearly $550 million in Iran-linked USDT this year alone.

Tether's CEO Paolo Ardoino rejected the report's premise, stating that USDT is not a haven for sanctioned actors or criminal networks. The company also highlighted its collaboration with law enforcement officials to stop illicit flows and its work with Israel's National Bureau for Counter Terror Financing (NBCTF).