Tether CEO Rejects Senate Claims Over Iran-Linked USDT
Tether disputes Senate allegations regarding delays in freezing wallets linked to Iranian proxies.
1Senate Subcommittee Report Allegations
A US Senate subcommittee report titled Tethered to Terrorism claims the stablecoin issuer failed to promptly freeze wallets associated with Iran and its proxies. The investigation analyzed 846 wallets sanctioned by OFAC or the NBCTF, finding that 84 percent of these entities transacted almost exclusively using USDT, raising significant concerns regarding sanctions enforcement.
2Tether CEO Counter-Arguments
CEO Paolo Ardoino disputed the findings on X, asserting that Tether consistently freezes addresses before formal designations occur. Ardoino claims that since 2023, the company has blacklisted reported addresses an average of four weeks before OFAC or NBCTF actions, and in 99 percent of cases, they acted before Chainalysis flagged the wallets.
3Specific Delay Case Studies
The report highlights specific delays, noting that after the NBCTF designated 39 wallets linked to a Hezbollah money launderer in June 2023, Tether only froze five immediately. The remaining 34 were not blocked until March 2024, allowing over 34.6 million dollars in USDT to exit those wallets after the initial seizure notice was published.
4Unblocked Iranian Central Bank Wallets
The subcommittee investigation identified that wallets linked to the Central Bank of Iran, posted publicly by sanctioned money launderer Babak Zanjani in December 2025, remained active and unblacklisted as of September. Furthermore, three wallets associated with Modex Exchange Company reportedly received 575 million dollars in USDT between April and June 2025 without intervention.
5Tether's Reported Enforcement Metrics
Tether maintains that its cooperation with law enforcement has led to a 94 percent decline in Iran-linked stablecoin volumes. The company reports having helped freeze nearly 550 million dollars in Iran-linked USDT throughout the current year, including 344 million dollars across two addresses connected to the Central Bank of Iran during April.
6Total Frozen Asset Volume
Beyond specific Iranian cases, Tether reports a total of over 4.9 billion dollars frozen across all global operations. This figure includes more than 2.4 billion dollars connected directly to US authorities and over 22 million dollars across 40 distinct cases referred by Israel’s National Bureau for Counter Terror Financing to date.
7Regulatory and Operational Friction
The conflict centers on the timing of compliance actions versus formal government sanctions. While the Senate subcommittee argues that Tether’s reactive approach creates windows for illicit capital flight, the company maintains that its proactive internal monitoring systems are more effective than relying solely on official government designations for freezing suspicious blockchain addresses.
8Implications for Stablecoin Oversight
This dispute underscores the growing tension between private stablecoin issuers and legislative bodies regarding financial surveillance. As Tether continues to manage billions in assets, the debate over whether they should act on intelligence before formal sanctions are finalized remains a critical point of contention for future regulatory frameworks governing digital asset infrastructure.
Original article: CryptoPotato — Tether CEO Rejects Senate Claims Over Iran-Linked USDT