Tether Partners With Chainlysis To Monitor Transactions Amid Mounting Scrutiny

Key Point

  • This solution is expected to allow Tether to further monitor the USDT market
  • It will also allow Tether to monitor the transactions of “significant” USDT holders.
  • Tether recently attracted attention for its alleged use of USDT on a licensed cryptocurrency exchange

Tether, the blockchain-enabled platform behind stablecoin giant Tether (USDT), has announced a partnership with prominent blockchain analytics firm Chainalysis to improve compliance practices by monitoring “secondary” transactions. That’s all.

Tether explained that secondary market activity is transactions that users make “within the broader ecosystem of USDT users, beyond the limited entities that buy and sell USDT directly from Tether.” . The collaboration with Chainaracy will allow Tether to gain a broader view of the digital asset ecosystem and further monitor the stablecoin market.

“It is also tether compliance This will allow us to identify wallets that may pose a risk or may be associated with illegal or sanctioned addresses,” the stablecoin giant said in a press release on Thursday. Stated.

In addition to sanctions monitoring, this monitoring solution will allow Tether to gain detailed visibility into USDT holders “by type, including exchanges and darknet markets.” This will also allow Tether to monitor the activities of “significant USDT holders.”

Finally, Tether Chainalysis’ blockchain monitoring solution is equipped with an “illegal transfer detector,” which USDT developers say can detect potential links to some illicit financing categories, such as terrorist financing. It says it is “essential” to detect certain transactions.

“Tether’s proactive efforts to monitor the secondary market for USDT, the world’s most popular cryptocurrency, has the potential to transform the entire ecosystem and make it a safer place to trade.” said Jonathan Levin, co-founder and chief strategy officer of Chainalysis.

Tether has worked with law enforcement agencies and crypto companies in the past to freeze funds in wallets associated with illegal activity. Most recently, the crypto giant blacklisted seven digital wallet addresses that received approximately $280,000 worth of USDT related to an exploit on cryptocurrency exchange FixedFloat.

In early March, Tether was recognized by the US Department of Justice (DOJ) for its assistance in the seizure of approximately $1.4 million in USDT tokens from the TechSupport fraud network. At the time, the stablecoin giant said it was volunteering assistance to the Justice Department and FBI to recover stolen funds.

But Tether has come under increased scrutiny following reports that the US and UK are investigating more than $20 billion worth of USDT via Garantex, a sanctioned Russia-based cryptocurrency exchange.

Also earlier this year, a United Nations report claimed that popular dollar-pegged tokens are being used by money laundering groups in East and Southeast Asia. At the time, Tether said it regretted that the report overlooked the company’s contributions to developing economies and emerging markets.

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