Tether announces new security policy to improve Stablecoin security

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Tether, the Stablecoin company, has introduced a new security measure—a voluntary initiative to freeze wallets. The procedure aims to prevent transactions associated with Sanctioned persons on the U.S. Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List.

“This strategic decision aligns with our unwavering commitment to maintaining the highest standards of safety for our global ecosystem and expanding our close working relationship with global law enforcement and regulators,” said Tether CEO Paolo Ardoino.

Tether said in a blog post that the new initiative adds to existing security measures and is a proactive step to enhance collaboration with regulators and law enforcement worldwide.

“Tether will now offer on the secondary market, the Sanctions controls it already enforces for wallets on its platform. This initiative is a proactive effort to work even more closely with global regulators and law enforcement agencies in safeguarding stablecoin usage,” said Tether.

Since December 1, Tether has provided secondary market controls to stop activity linked to individuals or entities sanctioned by the OFAC. The U.S. Treasury Department has used the list to prevent crypto transactions that might be linked to illegal activities, such as funding terrorism or unauthorized fentanyl distribution.

Freezing wallets listed on the SDN List goes against Tether’s past stance. In August 2022, Tether said it would not proactively freeze sanctioned Tornado Cash addresses unless told by law enforcement. OFAC noted that individuals and criminal groups have used Tornado Cash to launder more than $7 billion in cryptocurrency since 2019.

“By executing voluntary wallet address freezing of new additions to the SDN List and freezing previously added addresses, we will be able to further strengthen the positive usage of stablecoin technology and promote a safer stablecoin ecosystem for all users,” said Ardoino.

Tether moved $60 million worth of USDT to a “mysterious fund or institution” on December 8, according to data retrieved by Lookonchain. It also reported that Tether had sent a total of $1.76 billion USDT to this fund or institution since October 20.

These funds were then distributed to various exchanges. Because Tether is the issuer of the largest stablecoin globally, such significant transactions are likely to attract attention to its role in the crypto ecosystem. As of now, USDT continues its impressive performance in 2023, reaching a market cap value of $90 billion and dominating over 70 percent of the stablecoin market.

Ardoino talks Tether expansion

Named CEO on December 1, Ardoino anticipates Tether will earn $4.5 billion in profits from its main business this year. He also plans to unveil changes in the company’s product lineup and its overall direction.

“As we are going to show in the next quarter, Tether is much more than USDT,” Ardoino said.

Ardoino said he appreciates the concept of Web3 but lamented its current implementations, describing it as a bubble. This is why Tether is moving toward becoming an infrastructure provider.

“There is some talk about real-world assets, but what I think is more important is a real-world ecosystem,” he said.

Ardoino expressed excitement about Keet, a communication app, and its platform Holepunch, which is expected to play a significant role in the development of USDT.

“We believe Keet will be one of the biggest drivers of Bitcoin and USDT adoption in the world,” Ardoino said.

Ardoino revealed that Tether has 20 developers working on Keet. Tether plans to build hydropower plants in Uruguay and geothermal facilities in El Salvador.