Tether’s role in Iranian shadow banking is unprecedented and pervasive—providing what appears to be a primary and preferred cryptocurrency for the Islamic Republic’s schemes to prop up the regime and sustain its regional security threats. Recent media and industry reporting have illustrated the role of Tether’s stablecoin in Iranian and Russian money laundering schemes, including sanctioned Iranian oil sales and military procurement. Given Tether’s significant nexus to the United States, these recurring reports call into question whether the firm has taken sufficient action to investigate, prevent, and deter foreign adversaries from using its cryptocurrency in a manner that is directly adverse to American national security. Further, given Tether’s deep connections with the Trump Administration, its continuing use by the Iranian regime raises questions as to whether Tether has received lax enforcement and lenient oversight over its antimoney laundering obligations from relevant federal authorities.

As part of its ongoing inquiry into the role of cryptocurrencies in illicit finance, the Permanent Subcommittee on Investigation (PSI or the Subcommittee) conducted a forensic analysis of blockchain transaction data from 846 unique cryptocurrency wallets that have been sanctioned or targeted for seizure due to their association with Iran and its regional proxies.

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