Consumers’ Research, a prominent watchdog group, has launched a multi-million-dollar campaign targeting the stablecoin Tether (USDT). The campaign aims to raise awareness about Tether’s alleged involvement in illicit activities and its lack of transparency.
The campaign includes a comprehensive strategy: a new television ad supported by a seven-figure national buy, a dedicated website (TetheredToCorruption.com), a planned massive digital billboard in Times Square, and a series of mobile billboards in key locations such as Washington, D.C., and New York City. Additionally, a targeted digital campaign has been rolled out to amplify the message.
Will Hild, Executive Director of Consumers’ Research, expressed grave concerns about Tether’s operations. He highlighted Tether’s decade-long refusal to undergo a comprehensive audit, raising suspicions about the legitimacy of its reserves. Hild pointed to reports indicating that Tether is frequently used by criminal organizations, including drug traffickers, human traffickers, and sanctioned entities like Hamas, to facilitate illegal transactions.
“We are shining a light on Tether for their suspicious business practices,” said Hild. “Consumers should be wary of any so-called stablecoin that refuses to properly certify that they actually hold the assets they claim.”
In response to these accusations, Tether Holdings Limited has emphasized its commitment to transparency and financial stability. In May 2024, Tether released its first-quarter attestation for 2024, conducted by BDO, a leading global independent accounting firm. The report revealed a record profit of $4.52 billion and an increase in total group equity to $11.37 billion.
READ: Tether Unveiled as Key Player in Global Criminal Networks
Tether also disclosed that 90% of its issued tokens are backed by cash and cash equivalents, reflecting a robust liquidity position.
Paolo Ardoino, CEO of Tether, highlighted the company’s financial strength and its dedication to maintaining transparency in the cryptocurrency industry. “As shown in this latest report, Tether continues to shatter records with a new profit benchmark, reflecting the company’s sheer financial strength and stability.”
The Daily Mail reported on the campaign, describing Tether as the “next FTX,” referencing the infamous collapse of the FTX exchange. The article highlighted Tether’s alleged connections to criminal activities, including its use by terrorist organizations and human traffickers.
Consumers’ Research also called out Brock Pierce, a former Disney child star and co-founder of Tether, emphasizing his controversial associations, including ties with Steve Bannon and Jeffrey Epstein. Although Pierce is no longer affiliated with Tether, his past involvement has drawn scrutiny.
Tether has defended its practices, stating that all Tether tokens are pegged at a 1-to-1 ratio with matching fiat currency and backed 100% by its reserves. A Tether spokesperson mentioned that the company has integrated the FBI and the U.S. Secret Service into its platform to enhance efforts against criminal activity involving stablecoins. “To date, Tether has blocked or frozen over $1.3 billion in USDT linked to illicit activities,” the spokesperson said, emphasizing that approximately $1.6 million is related to terrorist financing.
In November 2023, Tether announced it froze nearly $225 million in funds tied to a human smuggling ring following a Secret Service investigation. These funds were linked to an international human trafficking syndicate in Southeast Asia responsible for a global ‘pig butchering’ romance scam. Furthermore, Tether has been implicated in drug smuggling operations, notably involving Chinese nationals manufacturing fentanyl in Mexico.
This also comes after a Wall Street Journal report bared that Tether has emerged as a major facilitator for Russian entities looking to work around Western sanctions over the invasion of Ukraine. The digital asset reportedly has become the preferred payment rail for a “shadow trade” keeping key Russian industries supplied with foreign goods despite financial restrictions. Its anonymous nature and massive $120 billion-plus daily trading volumes make tracing illicit transactions extremely difficult.
Despite these controversies, Tether remains a significant player in the cryptocurrency market, with a market cap exceeding $112 billion. The company continues to assert its commitment to transparency and financial integrity, though the Consumers’ Research campaign and ongoing media scrutiny suggest that debates over Tether’s practices are far from over.
Information for this story was found via the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
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