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Tether’s CEO says a Senate report on USDT and Iran ignores that Tether freezes wallets weeks before U.S. sanctions
Summary
Tether CEO Paolo Ardoino said on Monday that a Senate investigation into USDT’s role in Iran’s shadow banking network ignores how quickly the company acts, writing on X that since 2023 Tether has frozen flagged addresses on average four weeks before official sanction designations by the U.S. Treasury’s OFAC and Israel’s NBCTF.
Ardoino also wrote that Tether froze the reported addresses before Chainalysis labelled them 99% of the time, and that Tether’s actions led Iran-linked stablecoin volumes to fall 94%; CoinDesk reported his remarks, and those figures are Tether’s own claims, which SourcedBlock has not independently verified.
The report he is answering, “Tethered to Terrorism,” was released on Sept. 28 by Senate Permanent Subcommittee on Investigations Ranking Member Richard Blumenthal and the subcommittee’s Democratic minority staff; it analyzed 846 wallets sanctioned or targeted for seizure over links to Iran and its proxies and found that 84% transacted exclusively or nearly exclusively in USDT.
The report also said that before 2024 Tether did not comprehensively and consistently freeze wallets designated by counter-terrorism agencies, and Blumenthal has since asked Tether’s U.S. financial partner Cantor Fitzgerald to answer questions about the relationship by Oct. 23.
Key facts
- Ardoino’s post, published Oct. 19, said: “The reality shows that Tether acts fast on new threats thanks to its law enforcement partnerships.”
- CoinDesk reported that Ardoino also addressed the report remotely at DC Fintech Week last Tuesday, criticizing its release to the media before Tether could review it, and saying bad actors pushed out of USDT are “moving to other means that are outside of the control of the United States, and now outside of our control.”
- The subcommittee report said two sanctioned Iranian oil smugglers, Alireza Derakhshan and Arash Estaki Alivand, moved more than $603 million in USDT from 2021 to 2025 in a network connected to Hizballah, the Houthis and Iranian financial institutions.
- The report said the lack of deterrence before 2024 “invited abuse,” and that terrorist organizations such as Hamas shifted from transacting in bitcoin and a mix of cryptocurrencies to promoting USDT.
- In an Oct. 8 letter to Cantor Fitzgerald Chairman Brandon Lutnick, Blumenthal wrote that Cantor’s 5% stake in Tether has risen in value from $600 million to an estimated $10 billion since President Trump returned to office, and asked for documents and answers on its sanctions-compliance practices by Oct. 23, 2026.
- CoinDesk noted that the report came from Senate Democrats, and that Blumenthal could gain broader investigative powers if Democrats win back the Senate majority, odds of which have been rising on prediction market Kalshi.