U.S. Senator Richard Blumenthal, the ranking Democrat on the Senate Permanent Subcommittee on Investigations, has launched an inquiry into payments that Tether made to a consulting firm co-founded by Bo Hines, the former White House crypto adviser who now serves as CEO of Tether's U.S. arm.
Blumenthal sent letters on Thursday to Tether and to Nxum Group, the firm Hines started with his father and another partner, seeking details about the business arrangements.
Concerns Raised in Letter
In his letter to Tether CEO Paolo Ardoino, Blumenthal wrote that "the highly unusual terms and nature of Tether's business relationship with both Nxum and Bo Hines raise alarming ethical and legal concerns," suggesting that Tether was "likely well aware of the illegality and impropriety of issuing payments to a current White House official with such a direct role in shaping cryptocurrency legislation that was instrumental to its business."
The inquiry follows a Wall Street Journal report last week that Nxum received large payments for consulting work for Tether while Hines was still advising President Donald Trump and his administration on crypto policy, including on stablecoin issuers significant to Tether.
A Tether spokesperson did not immediately respond to a request for comment.
Background on Nxum and Hines
CoinDesk had previously reported that Hines' company, which had little track record or experience in politics, was making millions of dollars as the main campaign-advertising provider for a political action committee associated with Tether.
Nxum has recently hired another former White House crypto adviser, Harry Jung. The office that advised Trump on crypto issues has since gone vacant following the departure of Patrick Witt, who had replaced Hines as its executive director.
Broader Scrutiny
Blumenthal has focused significant attention on crypto, including Trump's memecoin, crypto backers of the president's projects, the Trump family crypto firm World Liberty Financial, activities at Binance, and especially Tether. He issued a report on Tether's financial connections to Iran and more recently demanded answers about Tether's connection to its U.S. financial partner, Cantor Fitzgerald.
Ardoino criticized the senator's work this week, saying Blumenthal ignored important information and shared his report with the press before giving the company a look or a chance to respond.
Though Blumenthal's party has been in the Senate minority during Trump's time in office, the still-narrow odds of Democrats taking back that chamber have improved in recent weeks. If Blumenthal returns to chair the investigations subcommittee, it would grant him significantly greater powers to subpoena and control the agenda, and he has made it clear that crypto would be high on his list of topic areas. Prediction market Kalshi gives Democrats a 69% chance at the moment.
