Key Takeaways
Senate investigators reported on September 28, 2026 that Iran moved an estimated $2 billion over the past year through Tether's USDT stablecoin.
The report called USDT a financial lifeline inside Iran's shadow banking network and said groups including Hamas shifted from Bitcoin toward the token.
Tether said it has supported nearly $550 million in freezes of Iran-linked wallets and stays in direct coordination with US authorities.
Democrats on the Senate Permanent Subcommittee on Investigations released a report on September 28 that describes Tether's USDT, the largest stablecoin, as a central tool in Iran's effort to move money around US sanctions. The report, led by Senator Richard Blumenthal, estimates the Iranian government transacted about $2 billion through crypto over the past year and calls the token a growing part of the country's shadow banking network.
The report found that USDT "has become a significant financial lifeline within Iran's shadow banking network," and said that before 2024 Tether did not consistently freeze wallets that counter-terrorism agencies had flagged. It also reported that groups including Hamas moved away from Bitcoin and began promoting USDT to supporters.
Tether pushed back. Chief executive Paolo Ardoino said the company stays in regular and direct coordination with authorities as governments work to disrupt sanctions evasion and terrorist financing. The company pointed to its own enforcement record, and last week it said it had helped freeze nearly $550 million in Iran-linked USDT this year.
The two accounts sit uneasily next to each other. A stablecoin issuer can freeze wallets faster than any bank can claw back a wire, and Tether has, yet the same transparency that lets it freeze funds is what let Senate investigators trace $2 billion in flows in the first place. The pattern here is hard to ignore, and it echoes the US probe of Binance over Iran sanctions that followed that exchange's record plea. Worth watching how Washington moves next.
People Also Ask
What did the Senate report say about Tether and Iran?
It found that Iran moved an estimated $2 billion through crypto over the past year and called Tether's USDT a financial lifeline inside the country's shadow banking network.
Which senators issued the Tether Iran report?
Democrats on the Senate Permanent Subcommittee on Investigations, led by Senator Richard Blumenthal, released the report on September 28, 2026.
How did Tether respond to the Senate report?
Tether said it stays in direct coordination with US authorities and has supported nearly $550 million in freezes of Iran-linked wallets this year.
Can stablecoin issuers freeze funds tied to sanctions?
Yes. Tether can freeze USDT held in flagged wallets, though the report said its freezing was inconsistent before 2024.
Sources
CoinDesk, The Block, U.S. Senate Permanent Subcommittee on Investigations, Tether.