Responding to UN claims that USDT has been used for illegal activities

adminJanuary 17, 2024

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Amid growing concerns about the role of cryptocurrencies in illicit financial operations, leading stablecoin issuer Tether and its custodian Cantor Fitzgerald have joined forces to respond to recent claims made by the United Nations. I went out. A recently released UN report highlighted Tether’s USDT, particularly its use on the TRON155 blockchain, as a preferred medium for a variety of criminal activities, including cyber fraud and money laundering.

The report, based on data from Bitrace, pointed out that transactions worth over 17 billion USDT from September 2022 to September 2023 were linked to illegal currency exchange, unauthorized trading of goods, illegal payment processes, and various criminal activities.

In a recent blog post, Tether expressed disappointment with the UN’s approach, criticizing the organization for singling out USDT and ignoring the UN’s important role in strengthening the economies of developing countries. Tether argued that the United Nations could greatly benefit from a deeper understanding of blockchain technology and its ability to deter financial crime. The company offered to help the United Nations gain this understanding, drawing on its experience working with various U.S. departments, including the Department of Justice, to create a more informed environment.

We believe that the United Nations can benefit from an expanded understanding of blockchain technology and the tremendous improvements it offers when it comes to combating financial crime. We encourage an active learning approach, believe this is essential for a more informed environment and are happy to support the United Nations in achieving greater understanding.

“They have what they say they have”

Cantor Fitzgerald, responsible for protecting Tether assets, also expressed support for this. CEO Howard Lutnick addressed long-standing speculation about Tether’s existence, assuring the reliability and adequacy of Tether reserves in a statement released at the Davos meeting. Tether has always maintained that each USDT is backed by an equal amount of US dollars. This claim was recently corroborated by an attestation report showing reserves of over $3.2 billion as of the third quarter of 2023. The report, approved by audit firm BDO Italian, adds credibility to Tether’s claims, especially considering its past engagements with other auditors. Firms like Friedman LLP.

I’m so excited for the Tether audit… Last I checked, Howard wasn’t an auditor.
— Occami News (@OccamiCrypto) January 16, 2024

In terms of compliance, Tether has shown significant progress in its position. Although they initially resisted orders from the U.S. Office of Foreign Assets Control, stablecoin issuers changed their policies starting in December 2023. This includes implementing controls on secondary markets and freezing assets in wallets outside of the platform. This change in approach is highlighted by Tether’s move to freeze 161 wallets, some of which are linked to OFAC-approved Tornado Cash, a stark contrast to its previous stance in August 2022 that it would not freeze Tornado Cash addresses. indicates.

In a broader context, Cantor Fitzgerald CEO Howard Lutnick shared his views on Bitcoin and his recent enthusiasm for Bitcoin ETFs. While Lutnick believes cryptocurrencies are inherently speculative, especially for the American public, he recognizes their important role as a payment mechanism in underdeveloped regions where mainstream financial services like Paypal and Venmo are lacking. This position provides an interesting perspective on the role of cryptocurrencies in various economic environments around the world and highlights their diverse applications and implications.

Through this ongoing discourse, Tether and Cantor Fitzgerald are trying to demonstrate their commitment to addressing regulatory issues and educating stakeholders about the positive aspects and potential of blockchain technology in the financial sector.

Where do we go from here?

Whether it’s just a show done for financial gain, to maintain a stronghold on the cryptocurrency stablecoin sector, or if it’s truly motivated by ethics is anyone’s guess. Cryptocurrency advocates would not be wrong to argue that restricting access based on government opinions about what is right and wrong goes against the fundamental principle of cryptocurrencies: providing freedom from government interference and abuse.