Tether has responded to the calls from U.S. lawmakers regarding its stablecoin use. The company, behind the stablecoin Tether (USDT), has sent letters to members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs and the U.S. House Financial Services Committee on Nov. 16 and Dec. 15, addressing concerns about the illicit use of its stablecoin. These letters detail Tether’s commitment to combatting the illicit use of stablecoins.
The lawmakers, Senator Cynthia Lummis and Representative French Hill, had called on the Department of Justice (DOJ) to evaluate whether Binance and Tether were providing material support for terrorism. This call came after allegations that illicit crypto transactions were supporting terrorism, particularly in relation to an attack by Hamas.
Tether’s response highlights its Know Your Customer (KYC) program, transaction monitoring system, and proactive approach to identifying suspicious accounts and activities. The company also emphasizes its cooperation with law enforcement agencies and its commitment to identifying and freezing accounts linked to sanctions, illicit activities, or terrorist financing.
Additionally, Tether mentions its use of surveillance monitoring tools, such as the Reactor tool from Chainalysis, to track client activity on the blockchain. The company has implemented a voluntary wallet-freezing policy to freeze activity associated with sanctioned individuals on the United States Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List.
Tether’s CEO, Paolo Ardoino, expressed the company’s desire to be a strong partner to the U.S., assisting law enforcement and contributing to the global expansion of the U.S. dollar.
The increased scrutiny of crypto firms in the U.S. in 2023 has not significantly affected USDT’s market share, which stands at $90 billion at the time of writing, according to CoinMarketCap.