Democratic members of the Senate Permanent Subcommittee on Investigations report that 84% of over 800 crypto wallets linked to Iran exclusively or primarily utilize Tether’s USDT stablecoin. According to the investigation, the token serves as a key payment channel for the Iranian regime to bypass U.S. sanctions and access the global financial system.
Tether states it has frozen approximately $550 million in Iran-linked USDT throughout the current year. The company’s actions include blocking $344 million across two wallets in April, which the Office of Foreign Assets Control later connected to the Central Bank of Iran. In July, Tether froze over $130 million in four wallets on the Tron blockchain.
CEO Paolo Ardoino noted that Tether acts when law enforcement provides credible information. However, a discrepancy remains in the company’s reporting, as the two specific freeze events total $475 million, leaving $75 million unaccounted for in the official release. The Senate is currently demanding further data on the volume of funds moved through these wallets prior to the freezes.
The Senate investigation, led by Senator Richard Blumenthal, highlights that USDT is used to fund groups such as Hezbollah. This scrutiny aligns with the U.S. Treasury’s Operation Economic Outcast, launched in August, which targets digital assets within five Iranian sectors subject to sanctions.
