Tether Freezes $550M in Iran-Linked USDT Amid Senate Sanctions Probe

Stablecoin issuer Tether disclosed on Monday that it assisted authorities in freezing nearly $550 million in Iran-linked USDT during 2026, including more than $130 million across four wallets and over $344 million connected to the Central Bank of Iran, which was frozen in April. The announcement, made by CEO Paolo Ardoino, underscored Tether's ongoing cooperation with international law enforcement and positioned USDT as a traceable asset rather than a tool for illicit finance.

The disclosure followed the release of a Senate Permanent Subcommittee on Investigations report authored by Democratic investigators, which alleged that USDT has become a central channel for Iran to evade US sanctions. According to the report, 84% of 846 crypto wallets sanctioned over ties to Iran had transacted exclusively or nearly exclusively in USDT. The findings prompted Senator Richard Blumenthal to formally call on the Treasury and Justice departments to open an investigation into potential sanctions violations by the stablecoin issuer.

Tether pushed back against the characterization, noting that its collaboration with the DOJ, FBI, Secret Service, HSI, OFAC and foreign authorities has resulted in more than $4.9 billion in assets being frozen to date, including over $2.4 billion connected to US authorities. "Tether has consistently demonstrated that USDT is not a haven for sanctioned actors, terrorist organizations or criminal networks," Ardoino said. The company's statement comes amid broader scrutiny of stablecoin compliance, including separate probes into Binance's Iran-linked activities reportedly led by the Manhattan US Attorney's office.