According to sources from The Wall Street Journal, US authorities have launched an investigation into Tether, the issuer of the USDT stablecoin, to identify potential violations of sanctions and anti-money laundering regulations. The report claims that Manhattan prosecutors are examining whether USDT has been used for illegal activities, including terrorism financing, drug trafficking, and cybercrime.

The US Department of the Treasury is also allegedly considering sanctions against Tether for the use of its stablecoin by individuals under US sanctions, the sources added.

Tether CEO Paolo Ardoino strongly denied this information.

As we told to WSJ there is no indication that Tether is under investigation. WSJ is regurgitating old noise. Full stop.
— Paolo Ardoino 🤖🍐 (@paoloardoino) October 25, 2024

“As we told WSJ, there are no signs that Tether is under investigation. WSJ is regurgitating old rumors. Period,” he stated.

Later, Ardoino released another statement, noting that the company is actively working with law enforcement to prevent the use of USDT by “rogue states” and criminals.

At Tether, we deal regularly and directly with law enforcement officials to help prevent rogue nations, terrorists and criminals from misusing USDt. We would know if we are being investigated as the article falsely claimed. Based on that, we can confirm that the allegations in…
— Paolo Ardoino 🤖🍐 (@paoloardoino) October 25, 2024

“We would know if we were under investigation, as falsely claimed in the article,” he added.

In Tether’s official blog, the company criticized the WSJ article, calling the accusations baseless and urging the media to avoid speculation based on unverified rumors.

“It is wildly irresponsible for WSJ to publish articles with reckless accusations with such confidence when none of the authorities have confirmed these rumors, and sources are unnamed,” Tether stated.

Recently, Cyber Capital founder Justin Bons also criticized Tether, expressing concerns about the company’s lack of transparency regarding its reserves, which he claimed resembled the situation with FTX.

It is worth noting that in October, Ardoino referred to Tether as the “best friend” of the US government, due to its compliance with regulatory requirements and its holding of US Treasury bonds worth approximately $98 billion. Earlier, Tether reported that it had assisted 145 law enforcement agencies in 40 jurisdictions to recover over $108.8 million in USDT since its launch in 2014.