Tether will gain the ability to monitor the secondary market for its stablecoin, courtesy of a solution developed by blockchain analysis firm Chainalysis. This advancement will enable Tether to glean market insights and detect wallets potentially linked to illicit or sanctioned activities.
Tether outlined four key tools in a recent announcement on its website. These include Sanctions Monitoring, which will identify addresses and transactions involving sanctioned entities, and Illicit Transfer Detector, designed to flag transactions potentially associated with activities like terrorism financing.
The solution will also offer Categorization, classifying Tether holders by type (e.g., exchange or darknet market), and Largest Wallet Analysis, focusing on significant USDT holders and their behaviors. Tether CEO Paolo Ardoino emphasized the importance of this collaboration with Chainalysis in enhancing transparency and security within the cryptocurrency industry.
Tether has partnered with authorities in 43 jurisdictions to combat illicit activities. However, it has faced criticism and scrutiny for its alleged involvement in criminal activities and terrorism financing. This includes accusations from Senator Cynthia Lummis regarding Tether’s role in Hamas attacks on Israel. Tether has defended itself against such claims, citing its efforts to ensure the traceability of USDT.
Despite criticisms and concerns, Tether maintains its position as the largest stablecoin by market capitalization, far surpassing competitors like USD Coin (USDC). However, it continues to face scrutiny regarding its financial transparency and alleged involvement in illicit activities.
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