Tether CEO Paolo Ardoino has challenged allegations that the company’s stablecoins have supported financial activity in Iran, defending its efforts to identify suspicious wallets and enforce international sanctions.
The company’s response comes after a report published last month by Democrats on the Senate Permanent Subcommittee on Investigations. The report accused Tether of serving as “a significant financial lifeline within Iran’s shadow banking network.” Ardoino argued on Monday that lawmakers had overlooked the company’s progress in monitoring and restricting transactions associated with sanctioned entities.
Senator Richard Blumenthal, the subcommittee’s leading Democrat, led the investigation as concerns grow among lawmakers over cryptocurrency’s potential role in illicit finance. Ardoino maintains that Tether frequently freezes suspicious addresses before they are officially designated by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) and Israel’s National Bureau for Counter Terror Financing (NBCTF).
In a post on X, Ardoino claimed that since 2023, Tether has frozen addresses an average of four weeks before the two authorities formally sanctioned them. He added that the company acted before Chainalysis flagged the addresses in 99% of cases.
Ardoino also attributed a 94% reduction in Iran-linked stablecoin transaction volumes to Tether’s enforcement measures.
Speaking remotely at Washington’s DC Fintech Week last Tuesday, Ardoino again addressed the Senate findings. He criticized the report’s release to the media before Tether had an opportunity to review it, arguing that the company’s perspective should also be considered publicly.
“I believe it’s important for the public also to hear our side of the story,” he said.
Ardoino described removing illicit actors from the USDT ecosystem as a central goal for Tether. He warned, however, that individuals and groups excluded from the network could shift to alternative payment methods beyond the oversight of both the company and U.S. authorities.
“Our aim is to push out the bad actors from USDT,” he said, adding that those actors were moving toward financial channels outside their control.
Although Ardoino acknowledged that more work remains, he said he believes Tether is taking the right approach to addressing illicit activity.
“I wake up in the morning and I look at myself in the mirror, and I know that we’re doing the right thing,” he said.
The Senate report reviewed activity spanning several years, with particular attention to the period before 2024. Investigators alleged that Tether had not comprehensively frozen flagged wallets during that period. They argued that the shortcomings allowed misuse to continue, claiming that terrorist organizations such as Hamas shifted from Bitcoin and other cryptocurrencies toward promoting USDT for transactions.
Following the report’s release, Blumenthal expanded his scrutiny to Tether’s relationship with Cantor Fitzgerald, its U.S. financial partner, which has close ties to President Donald Trump’s administration. Tether also appointed Bo Hines, a former White House crypto adviser under Trump, to head its U.S. division last fall.
Political developments could further affect the investigation. Prediction market Kalshi has recently shown rising expectations that Democrats, including Blumenthal, could regain control of the Senate. If that happens, Blumenthal could gain greater investigative authority, potentially intensifying congressional oversight of the cryptocurrency industry.
