Tether Denies US Government Investigation as Bitcoin Suffers From the Controversy

Bitcoin's momentum was recently halted by an explosive report by the Wall Street Journal. According to the New York-based publication, the US Treasury Department is building up a case against USDT's issuer, Tether.

Fresh Bitcoin price analysis reveals that the coin encountered difficulties on Friday as news broke that the US government is building up a case against Tether. According to the New York-based publication, the Manhattan US Attorney’s Office is leading the probe amid suspicions of the company’s violations of US sanctions and anti-money laundering laws.

The investigation comes after suspicions that third parties could have used Tether’s stablecoin to fund illegal operations and settle illegal transactions. These include its alleged involvement in drug trafficking, terrorism, and cybercrime financing, as well as laundering the proceeds arising from such illicit activities.

The Wall Street Journal (WSJ) now expects the US Treasury to immediately cease Tether’s operations in the US, including the use of its USDT stablecoin, if it finds sufficient reasons to do so.

Meanwhile, Tether CEO Paolo Ardoino took to X (formerly Twitter) to address the controversy. In his latest post, he ensured that his company regularly and directly cooperates with law enforcement officials to “help prevent rogue nations, terrorists, and criminals from misusing USDT.”

At Tether, we deal regularly and directly with law enforcement officials to help prevent rogue nations, terrorists and criminals from misusing USDt. We would know if we are being investigated as the article falsely claimed. Based on that, we can confirm that the allegations in…

Recently, Tether aided the government in freezing accounts linked to Venezuelan oil sanctions. It also worked with US ally Israel via its National Bureau for Counter Terror Financing (NBCTF) to freeze accounts connected to Hamas last year.

Ardoino went on to firmly deny that there’s an ongoing case build-up by the US government. He said that the allegations in the WSJ article are “unequivocally false.”

Bitcoin Price Suffers From Tether Controversy

Bitcoin price has suffered in the past 24 hours heading to Saturday morning. The prime crypto asset dropped by around 4.66% as it lost momentum from a peak of $68,722.16 all the way down to $65,521.79.

Despite that, it has shown strong support around that one-day local bottom as its price appeared to be bouncing back above $67K by 6:00 AM UTC.

Alongside this price movement was an increase in BTC’s trading volume by approximately 40% as $42.63 billion worth of the digital asset moved across DeFi wallet addresses. Meanwhile, the market cap of its 19.77 million circulating supply held at $1.33 trillion.

Bitcoin Price Analysis 1-Day Chart

Bitcoin price 1-day analysis. Source: CoinMarketCap

Amid its nearly 2% slump in the weekly chart, Bitcoin still held gains above 5% in the one-month and 94% one-year timeframes. At this point, it was only 9% away from its $73,750.07 all-time high seven months ago.

Concluding Thoughts

Bitcoin could still be on its way to the $88K or $97K target if the US election results would favor the crypto market. However, the coin may encounter difficulties along the way, especially with the US government building up a case against Tether.

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