Senate Democrats' report says Tether USDT aids Iran funding

A report led by Senate Democrats says Tether's USDT has become a significant financial lifeline for Iran and a tool for funding proxy organizations, including Hezbollah. The report analyzed 846 crypto wallets sanctioned by Israel and the United States in connection with Iran. It found that 84% of those wallets transacted in USDT. The report says the transactions included efforts to help the Iranian government move money across borders and support its currency amid US sanctions. Those transactions included activity through the Central Bank of Iran. Senator Richard Blumenthal said the report exposed Tether and its flagship token as central to Iran's shadow banking system. He called for the Treasury and Justice Departments to investigate Tether. Tether said it was committed to cooperating with the US government. The company said it supported the freezing of nearly $550 million in Iran-linked USDT in 2026. Tether CEO Paolo Ardoino said USDT was not a haven for sanctioned actors, terrorist organizations or criminal networks. The Treasury Department stepped up sanctions against Iran following the start of the US military campaign against the country this year. Last month, the department launched Operation Economic Outcast, which included a focus on crypto transactions.