Tether "Disappointed" At UN Report On Illicit Activity In Asia

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Last updated Jan 16, 2024 | 01:34 PM UTC

The Tether (USDT) stablecoin has written a response to last Friday's United Nations (UN) report that implicates the coin as one of the most popular tools for illicit activity worldwide. 

Tether singled out

The report, published on 15 January, from the Asia and the Pacific team at the UN Office for Drugs and Crime (UNDOC) takes aim at the increasing technological prowess of criminals and their respective networks, making note of the many new challenges law enforcement faces when it comes to tackling organized crime.
In the findings titled 'Casinos, Money Laundering, Underground Banking, and Transnational Organized Crime in East and Southeast Asia: A Hidden Accelerating Threat', USDT is highlighted as the main vehicle for underground money laundering, casinos, and other illicit activities, with a particularly on the TRON blockchain.

Citing a November 2023 Bitrace Fund Audit, the report writes: “Between September 2022 and September 2023, a recent fund audit of USDT-based transactions by one independent blockchain data analysis company found transactions totaling 17.07 billion USDT connected to underground currency exchanges, illegal commodity trades, unlawful collection and payment processes, and various criminal activities."

Tether responds

Tether was quick to reply, publishing a response yesterday to the study that asks for greater blockchain education among government officials.

It said: "We are disappointed in the UN’s assessment that singles out USDT highlighting its involvement in illicit activity while ignoring its role in helping developing economies in emerging markets, completely neglected by the global financial world simply because servicing such communities would be unprofitable for them."

Furthermore, it states that Tether tokens are monitored in collaboration with major global law enforcement agencies including the Federal Bureau of Investigation (FBI), the Department of Justice (DOJ), and the United States Secret Service (USSS). This is a standard that Tether argues is far greater and more effective than is applied to banks when it comes to anti-money laundering (AML) and other illicit financial activity.

Using public blockchains, it is possibly to track every single transaction, making Tether an “impractical choice” for such activity. Illustrating this, Tether writes: “This is evident in our freezing of more than US$300million within the last few months, showcasing our commitment to combating the criminal use of cryptocurrencies. Implementing security measures, including developing together with Chainalysis, a tool for monitoring secondary markets, highlights our dedication to community protection.”

In its closing statements, Tether describes a distinct lack of awareness and fundamental education that is much needed amongst UN officials, which it says would benefit the entity given that blockchain as a technology alone can be an excellent ally in the fight against financial crime.

Finally, it extends an olive branch toward the UN, openly inviting them for a “collaborative dialogue” that would see the UN brought in with the likes of the FBI and DOJ, so that Tether could demonstrate its continued commitment to “promoting transparency and accountability in digital currencies".

USDT ubiquity

With a market cap of more than $95billion, USDT is the most popular stablecoin by far, beating its nearest competitor USD Coin (USDC) by a difference of approximately $75bn. This also positions USDT as the third-most popular overall cryptocurrency by market capitalization.

With well over 4,500 trading pairs, USDT is also the most traded cryptocurrency. Its 24-hour trading volumes presently sit at over $40bn, which is twice as much as BTC and five times more than ETH.

Written by

Eddie is a seasoned crypto writer and Bitcoin maximalist.