A report released on January 15 by the United Nations (UN) Office on Drugs and Crime identified Tether, the USDT stablecoin issuer, as the “most popular vehicle for cryptocurrency-based money launderers in the Southeast Asian region.”
Tether Challenges UN Report
Tether released a response challenging the UN report. The company expressed disappointment in the UN’s assessment that singled out the stablecoin and “highlighted its involvement in illicit activity” but completely ignored USDT’s role in “helping developing economies in emerging markets.”
The response highlights that Tether’s continuous collaboration with global law enforcement, such as the DOJ, FBI, and USSS, ensures unparallel monitoring and surpasses traditional banking systems that “for decades have been the vessel for laundering substantial sums proven by the fines that have been levied on them.”
As the company explained, the Tether stablecoin uses public blockchains that make it possible to track every transaction, making it “an impractical choice for illicit activities.” In an interview, Tether’s CEO, Paolo Ardoino, stated, “In practice, Tether is the dumbest choice for doing illicit activity.”
Undoubtedly, the traceability of the stablecoin and its proven record of law enforcement collaboration are crucial points in its challenge to the UN report.
As previously reported, the stablecoin issuer has assisted the United States Department of Justice (DOJ) in fighting illicit activities and criminal use of cryptocurrencies. They froze over $225 million USDT tokens connected to an illicit organization involved in human trafficking and ‘pig butchering’ romance scams in Southeast Asia, as they detailed in their report:
This is evident in our freezing of more than US$300 million within the last few months, showcasing our commitment to combating the criminal use of cryptocurrencies. Implementing security measures, including developing together with Chainalysis, a tool for monitoring secondary markets, highlights our dedication to community protection.
A Call For Blockchain Education
Tether believes that blockchain education plays a crucial role in the fight against financial crime and that the UN should focus on “how centralized stablecoins can improve anti-financial crime efforts” instead of solely on their risk.
We believe the UN could benefit from an expanded understanding of blockchain technology and the immense improvements it offers with respect to fighting financial crime.
They extended an invitation to the UN to participate in a collaborative dialogue that’s been proven to be successful before with dozens of global law enforcement agencies.
They close their response by affirming that “Tether remains steadfast in promoting transparency and accountability in digital currencies.”