Tether Implements Chainalysis Monitoring System
Tether partners with Chainalysis to monitor USDT transactions to 'prevent illicit financial activities.'
Tether, the issuer of the world's largest stablecoin USDT, has announced a collaboration with blockchain surveillance firm Chainalysis. The partnership, revealed on Thursday, is designed to monitor the transactions involving Tether tokens on secondary markets, as stated in Tether's official blog post.
Tether Enhances Compliance Measures with Chainalysis Ecosystem Monitoring Solution. Tether has collaborated with @chainalysis, the blockchain data platform to develop a customizable solution for monitoring secondary market activity.
— Tether (@Tether_to) May 2, 2024
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The goal of the new monitoring system is to comply with international sanctions and the detection of "illicit transfers" potentially associated with nefarious activities such as terrorist financing. Tether's initiative is a response to the growing scrutiny from regulators and policymakers worldwide.
Paolo Ardoino, Tether's CEO, commented on the partnership: "Our collaboration with Chainalysis marks a pivotal step in our ongoing commitment to establishing transparency and security within the cryptocurrency industry."
The implementation of Chainalysis's surveillance system allows Tether to identify addresses and wallets that might "pose risks or may be associated with illicit and/or sanctioned addresses."
This development follows reports, including a United Nations report earlier this year, claiming that USDT has been used for underground banking and money laundering, particularly in East Asia and Southeast Asia. Moreover, Venezuela's state-run oil company has reportedly used USDT to evade U.S. sanctions
