0
0
Tether Initiates Freeze Policy for Sanctioned Addresses
Stablecoin issuer Tether has recently announced its decision to freeze any addresses associated with sanctioned entities, in response to reports indicating the misuse of its USDT tokens to bypass US sanctions. A spokesperson for the company stated:
“Tether respects the Office of Foreign Assets Control (OFAC) SDN list and is committed to promptly freezing addresses that are subject to sanctions.”
Proactive Measures Taken by Tether
Over the past year, Tether has taken proactive steps to freeze addresses holding substantial amounts of its digital assets that are involved in illicit activities. Notably, the company froze 32 addresses containing $873,118.34 linked to unlawful activities in Israel and Ukraine last year. This action underscores Tether’s dedication to upholding higher safety standards in the rapidly evolving industry.
Market Dominance of Tether’s USDT
Tether’s USDT stands as the largest stablecoin in terms of market capitalization, boasting an approximate circulating supply of $110 billion. Despite its compliance efforts, recent reports have highlighted the continued exploitation of the USDT stablecoin by terrorist organizations and sanctioned nations seeking to evade restrictions.
Challenges and Regulatory Concerns
For instance, Venezuela’s state-owned oil company, PDVSA, reportedly turned to USDT for its crude oil and fuel exports following the reinstatement of US sanctions. US Treasury Deputy Secretary Adewale Adeyemo has raised concerns about Russia’s increasing use of alternative payment methods, including Tether’s USDT, to circumvent economic sanctions. Additionally, a United Nations report highlighted the prevalence of cryptocurrency-based money laundering, with Tether and USDT on the TRON blockchain being commonly utilized for such illicit activities.
In response to these developments, US Senator Elizabeth Warren has advocated for stringent regulatory measures, emphasizing the importance of including stablecoin issuers and DeFi intermediaries in any proposed regulations to combat money laundering and terrorist financing. Exempting these entities from Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) requirements could potentially enable malicious actors to exploit the growing crypto trading landscape facilitated by such legislation.
Image/Photo credit: source url
