Tether Assures U.S. Lawmakers: Commits to Fight Illicit Use of Its Stablecoin
Summary:
Tether responds to U.S. lawmakers' concerns about its stablecoin USDT's potential illicit use, asserting its commitment to combating this in recent letters to the U.S. Senate Committee on Banking, Housing, and Urban Affairs and the U.S. House Financial Services Committee. As part of its response, Tether highlights procedures such as its KYC program, ongoing client monitoring, and proactive identification of suspicious activities. The firm states it will continue to assist in identifying and freezing accounts involved in illegal activities or terrorism financing. Tether also informs of initiating a voluntary wallet-freezing policy and its continued dedication to being a leading global partner to the U.S. In the midst of increased crypto regulations, USDT's market share stands strong at $90 billion.
Tether, the entity responsible for the stablecoin Tether (USDT), has released correspondence addressed to U.S. lawmakers, appealing to the Department of Justice to take action against the unauthorized use of its stablecoin. The letters were presented to the U.S. Senate Committee on Banking, Housing, and Urban Affairs, as well as the U.S. House Financial Services Committee on Nov. 16 and Dec.15. They focused on "Tether’s dedication to combating the unlawful employment of stablecoins." The communications were a response to Senator Cynthia Lummis and Representative French Hill's October call on the DOJ "to thoroughly assess the degree to which Binance and Tether may be indirectly aiding terrorism.” This came after accusations that the October 7 coordinated attack on Israel by Hamas was funded, at least in part, by crypto transactions facilitating terrorism.
Tether clarified that it has a proactive method for detecting suspicious accounts and activities, includes a Know Your Customer (KYC) initiative, and employs a transaction tracking system. "We have consistently cooperated with law enforcement as required, keeping a steadfast commitment to working in partnership with agencies worldwide. Tether always assists in pinpointing and freezing addresses engaging in illegal actions or contributing to terrorist funding."
Moreover, Tether mentioned that customer reviews don't stop at the initial sign-up stage, indicating that the company employs ongoing surveillance tools to monitor customer behavior continuously. Tether relies on the Chainalysis Reactor tool and obtains secondary market risk reports from this organization for surveillance, asserting that these mechanisms are the preferred choices for blockchain monitoring, utilized by many U.S. government agencies.
In a recent update, Tether declared on Dec. 9 that it had introduced a voluntary wallet-freeze policy enabling secondary market controls to curb illegal activities related to sanctioned individuals appearing on the United States Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List.
In 2022, Tether had previously declined to proactively freeze wallets involved in questionable activities. But, due to the increased strict regulatory scrutiny faced by crypto businesses both domestically and globally, Tether has had a change of course in its stance.
"Tether aspires to be a leading partner to the U.S., aiding law enforcement and promoting dollar dominance around the world,” Tether's CEO Paolo Ardoino declared. As per CoinMarketCap, USDT's market standing currently stands at $90 billion, largely aided by the increased vigilance of U.S. crypto firms throughout 2023. Report: Lawmakers' concerns contribute significantly to the proposed regulations governing cryptocurrencies in the U.S.
Published At
12/16/2023 8:24:18 PM
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