Key facts
- A U.S. Senate investigation found that 84% of sanctioned Iranian crypto wallets reviewed used USDT.
- Iran's Central Bank accumulated at least $507 million in USDT to operate under sanctions, according to the report.
- Tether stated it froze $550 million in USDT linked to Iran in 2026.
- Tether also froze over $344 million in April and over $130 million in July.
- Tether claims it has cooperated with U.S. and international law enforcement on sanctions enforcement.
Tether on Monday defended its compliance efforts after a U.S. Senate Democrats’ investigation found that its USDT stablecoin has become a primary payment method for sanctioned Iranian entities and a tool for funding terrorist proxy organizations.
The Senate Democrats Permanent Subcommittee on Investigations reviewed over 800 sanctioned crypto wallets and found that approximately 84% used USDT as their main or exclusive asset. The report also indicated that Iran's Central Bank had accumulated at least $507 million in USDT to navigate international sanctions.
This finding comes amid the U.S. Treasury's Operation Economic Outcast, aimed at cutting off Iran and the Islamic Revolutionary Guard Corps from cryptocurrency networks, and follows designations of Iranian exchanges like Nobitex, Wallex, Bitpin, and Ramzinex by OFAC.
Senator Richard Blumenthal had previously written to Tether in June requesting records regarding USDT's role in Iranian and Russian shadow-banking networks. The investigation also occurs shortly after Binance faced a DOJ investigation for potential Iran sanctions violations.
Tether argued that it has consistently cooperated with U.S. and international law enforcement, including freezing nearly $550 million in USDT identified by U.S. authorities as connected to Iran's Central Bank and sanctioned networks in 2026. The company also reported freezing over $344 million in April and more than $130 million in July across various TRON wallets. Paolo Ardoino, CEO of Tether, stated that the company has "consistently demonstrated that USD₮ is not a haven for sanctioned actors, terrorist organizations or criminal networks."