Tether Iran Dispute: Ardoino Pushes Back Against Senate

Tether CEO Paolo Ardoino said the company froze Iran crypto addresses an average of four weeks before official designations by the U.S. Office of Foreign Assets Control (OFAC) and Israel’s National Bureau for Counter Terror Financing (NBCTF), while attributing a 94% decline in Iran-linked stablecoin volumes to those actions.

This is part of Tether’s response to a Senate report; the company has not published the measurement period, baseline, address set, or asset scope behind the volume decline. Ardoino also said Tether froze reported addresses.

In an X post, Ardoino challenged Senator Richard Blumenthal’s interpretation of the Senate findings. His four-week average refers to the time between Tether freezes and official OFAC or NBCTF designations. The separate 99% figure concerns when Tether acted relative to Chainalysis labels.

The report, Tethered to Terrorism, was published on September 28 by Democratic staff of the Senate Permanent Subcommittee on Investigations. It examined 846 wallets sanctioned or targeted for seizure over links to Iran and its proxies between June 2021 and August 2026. The report found that 84% transacted exclusively or nearly exclusively in USDT.

One case in the report complicates Tether’s account of early action. Israel’s NBCTF designated 39 wallets tied to Hezbollah financier Tawfiq Muhammad Sa’id Al-Law in June 2023. Tether froze five, while the other 34 remained open until March 2024; more than $34.6 million in USDT left those wallets in the interim.

The report credited Tether with responding to designations “in some instances” since late 2023, while describing its overall effort as uneven and inconsistent. The Senate findings concern both USDT’s use by the wallets and the timing of action in individual cases, placing the company’s timing defense alongside a specific period of continued transfers.

Nearly $550 Million From Iran in Separate 2026 Tether Freeze Disclosures

In a disclosure released on September 28, Tether said it had supported freezes of nearly $550 million in Iran-linked USDT during 2026. The total included more than $344 million across two addresses in April and more than $130 million across four wallets in July. Tether did not itemize the roughly $76 million balance.

The Senate’s 84% figure measures the share of its wallet sample that used USDT almost exclusively; it is not a freeze-timing statistic. Tether’s separate volume claim concerns Iran-linked stablecoin activity, a distinction that matters when assessing the issuer’s role in cross-border payment flows and the visibility of wallet activity to blockchain analytics firms.

TRM Labs estimated Iranian crypto volume at about $11.4 billion in 2024 and $10 billion in 2025, a decline of roughly 12% across the broader market. CoinGecko put USDT’s market capitalization at about $183 billion. The larger market context makes Tether’s claimed reduction consequential for compliance scrutiny, while the company’s approach to regulatory compliance controls remains a central issue in the dispute.

Treasury and Justice Referrals Are The Next Step

Blumenthal, the subcommittee’s ranking member, referred the findings to the Treasury and Justice departments. His referral asks officials to consider potential sanctions and banking-law violations, including under the International Emergency Economic Powers Act and the Bank Secrecy Act.

The immediate institutional question is whether either department acts on that referral. The report also said Tether had confirmed receipt of the subcommittee’s June letter without responding to it as of the report’s publication.

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