Tether has frozen $550 million in USDT linked to Iran.

Tether, the issuer of the USDT stablecoin, announced that since the beginning of the year, it has blocked $550 million in wallets linked by U.S. authorities to the Central Bank of Iran and entities facilitating sanctions evasion. In April, the company froze over $344 million across two addresses at the request of U.S. law enforcement agencies. In July, Tether blocked an additional $130 million-plus in USDT across four wallets following new sanctions imposed by the U.S. Treasury Department. Tether’s statement coincided with a Wall Street Journal report on an investigation by Democratic lawmakers in the U.S. Senate. According to the investigation's findings, the wallets sanctioned for their ties to Iran overwhelmingly utilized USDT. Journalists report that Iranian authorities actively use this dollar-pegged stablecoin to conduct transfers that bypass the traditional financial system. The U.S. Senate is examining the effectiveness of Tether’s efforts to identify and block addresses linked to sanctions evasion—capabilities the company possesses. In recent years, the U.S. and Israel have identified hundreds of crypto wallets linked to Iran, the Islamic Revolutionary Guard Corps (IRGC)—which effectively rules the country—and its partners. Most of these wallets conducted USDT transactions on the Tron and Ethereum networks. The stablecoin was used in schemes involving the sale of Iranian oil and the financing of the Houthis; the newspaper reports that hundreds of millions of dollars flowed through two identified Chinese networks. Iranian crypto exchanges—Nobitex, Wallex, Bitpin, and Ramzinex—have been identified as key links, as they allow users to exchange USDT for Iranian rials. The U.S. imposed sanctions on these trading platforms in June. Recently, the U.S. Department of Justice launched an inquiry into whether Binance Holdings violated sanctions against Iran. Authorities are investigating whether the world’s largest cryptocurrency exchange by trading volume may have facilitated transactions involving crypto assets in circumvention of sanctions against Iran, and whether any potential violations were intentional.