Tether Chief Executive Paolo Ardoino said on October 19 that the company's wallet freeze program has cut Iran-linked stablecoin transaction volumes by 94% since 2023, pushing back against a recent U.S. Senate report that described the dollar-pegged token as a financial lifeline for Iran.

Ardoino shared the figures in a post on X. The Senate report had raised concerns about Iran's use of Tether's stablecoin and placed the company under fresh scrutiny in Washington. The exchange pits the company's self-reported enforcement figures against the subcommittee's findings, each backed by different data on Iran's use of dollar-pegged tokens.

Tether Says It Acts Before Regulators

Ardoino said Tether froze the relevant wallet addresses an average of four weeks before the U.S. Treasury's Office of Foreign Assets Control (OFAC) issued official designations. He added that in 99% of cases, the company acted before blockchain analytics firm Chainalysis labeled the addresses.

Freezing a wallet prevents the tokens held at that address from being moved or spent — a lever available to Tether because, as USDT's issuer, it can block specific addresses at the token level.

Blockchain analytics firm TRM Labs has tracked a similar decline. Its data shows Tether's share of on-chain transaction volume in wallets attributed to Iran fell from 67% in 2025 to 14% by August 2026.

Tether has frozen roughly $550 million in Iran-linked tokens so far in 2026, according to Ardoino. The total includes $344 million in April and $130 million in July. The company has also frozen wallets tied to Wallex, an Iranian exchange, and to other sanctioned platforms in the past.

Senate Report Raised Concerns

Ardoino's remarks respond to a September 28 report from the Democratic staff of the Senate Permanent Subcommittee on Investigations. The report reviewed 846 flagged Iran-linked wallets and found that 84% of them transacted almost entirely in Tether's stablecoin. It described the token as a major financial lifeline for Iran's shadow banking network.

Iran's Central Bank has also built up roughly $507 million in Tether tokens to support the rial, the country's currency.

USDT, issued by Tether and designed to track the value of the U.S. dollar, is the largest stablecoin by a wide margin. It carries a market value of about $183 billion and accounts for more than 60% of the total stablecoin market. That scale is part of why the token's role in Iran-related flows has drawn scrutiny from both blockchain analytics firms and U.S. lawmakers.

The issue surfaces as U.S. lawmakers continue to debate the GENIUS Act, a stablecoin regulatory framework. Separate reports have shown that a firm linked to Bo Hines received $6.3 million from Tether while he helped shape stablecoin legislation.

Operation Economic Outcast

The dispute also comes amid a broader U.S. campaign against Iran's financial channels. In August 2026, Washington launched Operation Economic Outcast, an effort to cut off Iran's financial lifelines. Treasury Secretary Scott Bessent said the United States is targeting about $1 billion in Iran-linked crypto assets for seizure under the program. Those assets have not been officially confirmed as frozen.

While TRM Labs' data aligns with the overall trend, the 94% figure itself has not independently verified. Senator Richard Blumenthal, who led the subcommittee probe, has not publicly responded to Ardoino's claim. The open questions now include whether the subcommittee responds to the company's figures and whether the roughly $1 billion in assets targeted under Operation Economic Outcast are formally confirmed as frozen.

Source: Blockonomi