Tether says it helped freeze nearly $550 million in Iran-linked USDT (USDT) this year, as Sen. Richard Blumenthal urged a federal probe of the stablecoin issuer.
Key Points:
- Tether says Iran-linked freezes of its stablecoin reached nearly $550 million in 2026.
- A Senate Democratic report found 84% of 846 sanctioned Iran-linked wallets relied almost entirely on USDT.
- Blumenthal asked Treasury and the Justice Department to examine Tether's sanctions and anti-money laundering controls.
Tether USDT Freezes
The company said in a Monday statement that actions involving its token froze roughly $550 million across wallets that U.S. authorities tied to the Central Bank of Iran and Iranian sanctions networks.
The disclosure landed the same day Democratic investigators on the Senate Permanent Subcommittee on Investigations released a report calling USDT a key channel for Iran to dodge sanctions.
In April, Tether froze more than $344 million across two addresses after tips from the Treasury's Office of Foreign Assets Control and U.S. law enforcement. OFAC listed those addresses as Central Bank of Iran identifiers the next day. A July action locked more than $130 million in four more wallets.
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Richard Blumenthal Report
Investigators analyzed blockchain data from 846 wallets that were sanctioned or targeted for seizure over ties to Iran and its regional proxies. They found that 84% of them transacted exclusively, or nearly exclusively, in USDT.
"My new PSI report exposes how Tether and its flagship token have become central to Iran's shadow banking system," Blumenthal said.
In letters to Treasury Secretary Scott Bessent and Attorney General Todd Blanche, the Connecticut Democrat asked both departments to examine Tether's anti-money laundering and sanctions compliance. He also pointed to Cantor Fitzgerald, the firm Howard Lutnick ran before becoming commerce secretary, which he said owns 5% of Tether.
Tether Compliance Dispute
Chief Executive Paolo Ardoino insisted that USDT "is not a haven for sanctioned actors, terrorist organizations or criminal networks." The report tells a different story about 39 Hezbollah-linked wallets that Israel flagged in June 2023, only five of which Tether blacklisted at first. Investigators calculated that more than $34.6 million in USDT left those wallets after Israel's seizure notice.
The report capped months of pressure from Blumenthal, who on Jun. 4 asked Tether for records on wallet freezes, sanctioned exchanges and its view of its U.S. legal obligations. The company acknowledged that letter but had not answered it by the time the report came out.
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