Tether Under Scrutiny as Senate Investigation Uncovers Widespread Use in Iran's Informal Banking Sector

A Senate investigation has found that Tether's USDT stablecoin is widely used in Iran's informal banking sector, raising concerns about its compliance with anti-money laundering (AML) and sanctions laws.

The report, compiled by Democratic minority staff on the U.S. Senate Permanent Subcommittee on Investigations, analyzed crypto activity over five years and found that 84% of 846 wallets studied used USDT for nearly all transactions.

Of the 757 wallets reported to Israel's National Bureau for Counter Terror Financing, law enforcement officials said that 87% of those wallets transferred at least 80% of their transactions in USDT. The report also found that 57% of 101 wallets sanctioned by OFAC and linked to Iran or Iranian entities primarily used a stablecoin.

Tether disputed the report's findings, with CEO Paolo Ardoino stating that USDT is free of significant illicit activity by sanctioned individuals and entities and terrorist groups. The company also claimed that it has assisted with over 2,900 investigations worldwide, including over 1,600 involving U.S. authorities.