Tether CEO Paolo Ardoino has debunked claims that the US Department of Justice (DoJ) is investigating stablecoin issuers, insisting the report is old noise.
Mr. Ardoino on Friday called on X to discard speculation, noting there is no indication that U.S. prosecutors are scrutinizing Tether. Notably, this claim was made after the Wall Street Journal published a report citing possible investigations into stablecoin issuers.
As we told WSJ, there is no indication that Tether is under investigation. WSJ is regurgitating old noise. Full stop.
— Paolo Ardoino 🤖🍐 (@paoloardoino) October 25, 2024
For context, a Friday report in the WSJ claimed that the U.S. Department of Justice is investigating Tether for its role in money laundering. The report noted that investigations into the fraudulent use of the largest stablecoin by market capitalization have been ongoing for several years.
Additionally, WSJ reported that US prosecutors are considering sanctions against the cryptocurrency company for its alleged involvement in widespread fraud. It also pointed out that more than $190 billion of USDT was traded every day, a large portion of which was supporting terrorist organizations like Hamas.
https://x.com/thecryptabasic
Irresponsible reporting of tethered calls
Notably, the stablecoin issuer also debunked the rumors on its blog, branding them “irresponsible” and “reckless claims.” The Journal cited people familiar with the matter, but Tesar said the publication lacked credibility and was based on mere speculation.
Tether claimed to have a well-documented working relationship with law enforcement, detailed in periodic reports. Additionally, the cryptocurrency company said it has contributed to the arrest of cybercriminals and fraudsters.
It should be mentioned that Tether recently announced that it will be working with Tron Network to launch the T3 Financial Crimes Unit (FCU), a company dedicated to fighting cybercrime. The team had frozen $12 million worth of illicit funds when it launched in early September.
Market struggles after rumors of investigation
After the release of the WSJ report, the cryptocurrency market experienced severe downward volatility, with Bitcoin rising to $66,000. The brief capitulation also affected altcoins, with Ethereum and Solana falling to $2,391 and $160, respectively.
Meanwhile, the crypto derivatives market has seen significant positions worth more than $390 million in the past 24 hours, with a surge in position liquidations due to price fluctuations. The liquidation heatmap was concentrated on Bitcoin, Ethereum, and Solana, with traders losing $67.3 million, $62.21 million, and $27.79 million, respectively.
As of this writing, Bitcoin has recovered above $67,000, Ethereum is trading at $2,461, and Solana is trading hands at $166 per coin.
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