Senate Democrats call USDT a 'lifeline' for Iran's sanctions-bypass network

Democrats on the Senate Homeland Security committee's Permanent Subcommittee on Intelligence published a report arguing Tether's USDT has become "a significant financial lifeline within Iran's shadow banking network," letting Tehran bypass international sanctions. The report, first reported by the WSJ, says Tether has "repeatedly failed" to block Iran-connected wallets, sometimes taking weeks or responding without actually blacklisting addresses, and pegs the Iranian government's transactions at roughly $2 billion last year.

The report casts Iran's USDT use as part of a broader indictment of crypto, saying cryptocurrencies are "actively undermining" U.S. efforts to contain Iranian regional activity. Tether pushed back the same day, citing its support for nearly $550 million in Iran-linked USDT freezes and saying it stays "in regular and direct coordination" with U.S. and global authorities, per CEO Paolo Ardoino.