Tether taps Chainalysis to track USDT activity on secondary markets

Stablecoin issuer Tether announced that it has partnered with blockchain forensics firm Chainalytic to develop a tool for monitoring secondary market activity.

Tether plans to increase its oversight of the USDT market as it has signed a partnership agreement with Chainalytic, a New York-based blockchain intelligence firm. In a May 2 blog announcement, Tether said the solution by Chainalytics will serve as a “proactive intelligence source” for compliance investigators, allowing them to “identify wallets that may pose risks or be associated with illegal and/or sanctioned addresses.” .”

“Our collaboration with Chainaliz marks a pivotal step in our ongoing commitment to creating transparency and security in the cryptocurrency industry.”

Tether CEO Paolo Ardoino

Developed by Chainalytics, the tool includes features such as tracking sanctions and providing a list of addresses and transactions related to sanctioned entities.

Additionally, it categorizes USDT holders by type, distinguishing between exchanges and darknet markets. Additionally, Tether added that the tool also offers an illicit transfer detector that allows the identification of transactions “potentially associated with illicit categories such as terrorist financing.”

The collaboration comes as US senators voice concerns about the potential misuse of Tether’s stablecoin by countries such as Russia, Iran and North Korea to circumvent Western sanctions.

As Crypto.news previously reported, allegations have emerged that USDT allows Russian companies to bypass sanctions and source components for drones and other equipment from abroad. As a result, senators questioned whether the Defense Department and the Biden administration supported the Treasury Department’s request to expand authority.