There are rumors that Tether may be the subject of a federal investigation.
The Wall Street Journal claims that the US government is investigating Tether. In an article published last week, the magazine cited unnamed sources and said that federal investigators in Manhattan are investigating suspected anti-money laundering violations and whether illegal actors used virtual currencies to finance their illegal activities. It said it was investigating.
Tether categorically denies the allegations.
In a statement on Friday, a Tether spokesperson said: “We cannot publish such credibly reckless claims when authorities have no records to confirm these rumors and no sources have been named.” It would be extremely irresponsible for WSJ to write about this.” “These stories are based on pure ranking speculation, even though Tether has confirmed that it has no knowledge of any such investigation into the company.”
Read more: Lummis, Hill, Binance and Tether seek ‘immediate’ Justice Department action
The report comes months after the conservative nonprofit Consumers Research launched a campaign against Tether, claiming the stablecoin is “used by the world’s worst actors.” Will Hild, executive director of consumer research, told me on Tuesday that the WSJ article “reiterates the need for Tether to be publicly audited by a trusted third party.”
“Consumers should be alarmed by Tether’s involvement with bad actors around the world, and it begs the question why they are so desperate to keep them on the platform,” Hild said. added.
Tether CEO Paolo Ardoino assured the public over the weekend that Tether’s USDT reserves are safe and abundant. He said the company holds about $100 billion in U.S. Treasuries, 82,000 Bitcoins and 48 tons of gold.
Read more: Tether reports first-half 2024 net income of $5.2 billion
To be clear, the WSJ article does not allege that Tether lied or violated any laws regarding its reserve assets. In 2021, the company settled with the Commodity Futures Trading Commission for $42.5 million over “claims that USDT is fully backed by U.S. dollars.”
Ardoino added that Tether has historically worked with law enforcement to combat fraud. He said the company has “voluntarily blocked” approximately 2,000 wallets suspected of illegal activity.
In September, Tether hired PayPal veteran Jesse Spiro to lead its government affairs team.
“Jesse will be responsible for leading policy and engagement with legislators, regulators and key stakeholders,” Tether said in the announcement.
He might be very busy.
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