Tether Denies UN Money Laundering Claims, Highlights Law Enforcement Collaboration

Tether, publisher of USDT stablecoins, has denied accusations made by the United Nations Office on Drugs and Crime (UNODC) that USDT is the preferred tool for crypto-based money laundering in Southeast Asia. Tether, one of the largest stablecoins by market cap, has condemned the report as "inaccurate, unfair, and incommensurate," highlighting its cooperation with global law enforcement agencies and the transparency of USDT stablecoins due to their use of public blockchains.

Tether Rebuts UN's Money Laundering Allegations, Emphasizes Cooperation with Law Enforcement

Jakarta, Indonesia - Tether, the issuer of the world's most widely used stablecoin, USDT, has vehemently denied accusations made by the United Nations Office on Drugs and Crime (UNODC) in a report released on January 15, 2024. The report had claimed that Tether was "the most popular advice for crypto-based money launderers in Southeast Asia."

Stablecoins and Tether

Stablecoins are a type of cryptocurrency whose value is pegged to a stable asset, such as fiat currencies or gold, making them less volatile than other cryptocurrencies. USDT is a stablecoin that is pegged to the US dollar, and it is one of the largest by market capitalization. USDT is developed on the Ethereum blockchain, utilizing the ERC-20 token standard.

Tether's Response

Tether released an official statement strongly condemning the UNODC report as "inaccurate, unfair, and unsubstantiated." The company asserted that the report had ignored USDT's positive role in "driving economic growth in emerging markets" and "enhancing financial inclusivity and accessibility for millions of individuals."

The statement highlighted Tether's ongoing collaboration with various international law enforcement organizations, including the United States Department of Justice (DOJ), the Federal Bureau of Investigation (FBI), and the United States Secret Service (USSS), in the fight against illegal activities and the misuse of cryptocurrencies.

Tether emphasized that these partnerships have enabled rigorous oversight that surpasses the traditional banking system, which has been "shown to facilitate the laundering of vast sums of money through fines levied against them for decades."

Transparency of Tether Transactions

Moreover, Tether underscored that USDT stablecoins utilize public blockchains, which record every transaction, making them "an impractical choice for illicit activities." In an interview, Tether CEO Paolo Ardoino asserted, "Logistically speaking, Tether is the worst choice for carrying out illicit activities."

Concrete Examples of Cooperation

Tether provided a concrete example of its assistance to the DOJ in combating illicit activities and the use of cryptocurrencies by criminals. In November 2023, Tether froze over 225 million USDT tokens linked to a criminal organization engaged in human trafficking and fraud in Southeast Asia.

The organization had utilized USDT to transfer funds between victims and perpetrators and to acquire other crypto assets. Tether, in collaboration with Chainalysis, a blockchain analytics firm, monitored the secondary market to trace the illicit funds.

In recent months, Tether has frozen over $300 million, highlighting the company's commitment to combating the misuse of cryptocurrencies for criminal purposes.

Collaboration with the United Nations

Tether invited the United Nations to engage in collaborative dialogues, which have been proven successful with numerous international law enforcement agencies. Tether believes that blockchain education is essential in combating financial crimes and that the United Nations should focus on "how regulated stablecoins can enhance efforts to combat financial crimes" rather than solely highlighting potential risks.

Tether concluded its statement by reiterating its unwavering commitment to accountability and transparency, as reported by CryptoBasic. The company remains dedicated to promoting transparency and accountability in the digital asset industry.