Tether research report causes crypto market turmoil

The United States federal government is conducting an investigation into the publisher of stablecoin Tether, as reported by The Wall Street Journal on October 25. According to sources familiar with the matter, this news caused a ripple in the cryptocurrency market, despite Tether CEO Paolo Ardoino dismissing it as “old noise.”

Justice and Finance Ministries are reportedly scrutinizing Tether, with the United States Attorney’s Office for the Southern District of New York conducting a criminal investigation into the potential misuse of Tether by third parties for illegal activities. Simultaneously, the Treasury Department is considering sanctioning Tether due to its alleged association with U.S.-sanctioned individuals and groups.

Tether, a stablecoin with daily trading volume reaching up to $190 billion, responded to the allegations by calling them “outrageous.” The company emphasized its cooperation with law enforcement to prevent misuse of cryptocurrencies and criticized The Wall Street Journal for its reporting.

Tether has faced criticism from various sources, including the United Nations and consumer protection organizations. Given the current U.S. government’s stance, the investigation into Tether is seen as a plausible development.

Tether and Bitfinex, a related cryptocurrency exchange, were fined $42.5 million by the Commodity Futures Trading Commission for violating regulations. Ripple CEO Brad Garlinghouse suggested that the U.S. government’s actions against Tether were evident, although he did not provide further details.

News of the investigation has caused turbulence in the broader crypto markets, with major cryptocurrencies like Bitcoin, Ether, BNB, Solana, and XRP experiencing price fluctuations in response.

The crypto market has reacted to the investigation news, with Bitcoin and other major cryptocurrencies experiencing price drops and fluctuations. Despite some recovery, uncertainty prevails in the market.

SOURCE

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