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FIGR_HELOC $1.01Tether pushes back as Senate probe finds USDT in 84% of Iran wallets
Tether says it froze $550 million in Iran-linked USDT in 2026, while a Senate report says the stablecoin is Iran's main crypto payment rail.
Key takeaways
- Most wallets used USDT. About 84% of more than 800 sanctioned crypto wallets reviewed used USDT as their main or exclusive asset.
- Tether froze $550 million. Tether says it froze $550 million in Iran-linked USDT in 2026 and more than $344 million across two addresses in April.
- Central bank held $507M. The reporting said Iran's Central Bank had accumulated at least $507 million in USDT to operate under sanctions.
What happened
Tether pushed back on Monday against a US Senate Democrats' investigation that found Iranian crypto wallets used USDT to evade sanctions. The company said it had already frozen nearly $550 million in Iran-linked USDT this year at the request of US authorities. The subcommittee found USDT is a main payment rail for the Iranian regime and for funding groups such as Hezbollah.
The subcommittee's report is titled "Tethered to Terror: Crypto & Iran's Shadow Banking Network" and was promoted by Senator Richard Blumenthal (D-CT). It reviewed 846 sanctioned addresses with ties to Iran or Iran-backed groups. The report says Tether freezes funds too slowly, creating what it calls a "permissive environment."
Tether said it is "fully committed to supporting global efforts against illicit finance" and that it works with Israel's National Bureau for Counter Terror Financing. CEO Paolo Ardoino said the company has consistently demonstrated that USDT is not a haven for sanctioned actors, terrorist organizations or criminal networks.
Why it matters
The finding lands during the US Treasury's Operation Economic Outcast campaign to cut Iran and the Islamic Revolutionary Guard Corps off from crypto networks. OFAC has designated Iranian exchanges such as Nobitex, Wallex, Bitpin and Ramzinex.
The scrutiny also reaches other firms. Binance is under DOJ investigation over possible Iran sanctions violations, and co-CEO Richard Teng recently distanced the exchange from a related civil forfeiture case.
Tether argues US authorities, including the DOJ, the FBI, the Secret Service and OFAC, have repeatedly accepted its role in enforcement operations. The subcommittee says the issuer is too slow to freeze.
What the data shows
About 84% of more than 800 sanctioned crypto wallets reviewed used USDT as their main or exclusive asset. The same reporting said the Central Bank of Iran had accumulated at least $507 million in USDT to operate under sanctions.
Tether says it froze $550 million in Iran-linked USDT in 2026, including more than $344 million across two addresses in April and more than $130 million across four additional TRON wallets in July. The study says Circle's USDC was extremely limited in the subcommittee's analysis.
The report also notes that Iran-based groups use bitcoin (BTC), ether (ETH), TRX and other altcoins alongside USDT.
Background
Senator Richard Blumenthal, ranking member of the Permanent Subcommittee on Investigations, wrote to Tether in June seeking records on USDT's role in Iranian and Russian shadow-banking networks. Tether argued it remained compliant and cooperated with US and international law enforcement.
What is still unclear
- It is not clear from the reports whether Tether's freeze figures address the subcommittee's concern that the issuer acts too slowly.
- The reports do not say whether the Senate report will lead to further enforcement action against Tether.
Questions readers ask
What did the Senate report find about USDT?
The Permanent Subcommittee on Investigations found that about 84% of more than 800 sanctioned crypto wallets reviewed used USDT as their main or exclusive asset. It says USDT is a main payment rail for Iran and Iran-backed groups.
How much USDT has Tether frozen?
Tether says it froze $550 million in Iran-linked USDT in 2026. That includes more than $344 million across two addresses in April and more than $130 million across four TRON wallets in July.
What does Tether say about the findings?
CEO Paolo Ardoino said USDT is not a haven for sanctioned actors, terrorist organizations or criminal networks, and Tether says it works with law enforcement on freezes.
Is Binance involved in the Iran sanctions scrutiny?
Binance is under DOJ investigation over possible Iran sanctions violations, and co-CEO Richard Teng recently distanced the exchange from a related civil forfeiture case.
