USDT Stablecoin Used to Evade Sanctions in Iran, Senate Report Finds

A US Senate Democrats report has found that Tether's USDT stablecoin is being used as a key payment mechanism in an Iranian cryptocurrency network, helping to move funds around international sanctions. The report analyzed blockchain activity involving 846 cryptocurrency wallets sanctioned or targeted for seizure because of their links to Iran and Iranian proxies.

The investigation found that 84% of the wallets had transacted exclusively or almost exclusively in USDT. The network has been used to move funds into and out of Iran, support efforts to prop up the Iranian rial, and facilitate transactions connected to military equipment and regional proxy organizations.

The report criticized Tether for not consistently freezing wallets identified by US and Israeli counter-terrorism authorities before 2024. It also noted that Tether has continued to allow some illicit wallets to operate.