DOJ is Reportedly Investigating Tether Executives for Possible Bank Fraud

Kavya  |  Jul 26, 2021

The US Department of Justice (DOJ) is reportedly investigating Tether executives, with investigators looking into the company's prior contacts with banking partners.

Why The DOJ Is Investigating Tether Executives?

Tether, the stablecoin issuer, has published a statement in response to a shocking Bloomberg article claiming that its executives are being investigated by the US Department of Justice.

According to the business, the piece is "repackaging" outmoded allegations for a compelling narrative that would attract hits.

Tether also underlined their commitment to working with the US government and other governments across the world:

“We are proud of our role as industry leaders in fostering collaboration between business and government authorities in the United States and across the world. We are committed to our customers, as well as the industry-leading technology and transparency that has fueled our success.”

Tether's reaction seemed to have persuaded the market, as Bitcoin jumped to $39,328 on the Bitstamp platform.

Tether CTO Paolo Ardoino says in a tweet that a distributed denial-of-service (DDoS) assault is being attempted on the stablecoin issuer's website.

Concerns About Centralization Arise As A Result Of The Tether Freeze

According to subsequent vulnerability disclosure, the team was able to neutralize the assault in 11 minutes, preserving 24 million DAI out of the 35 million DAI in the vault, with $11 drained from the vault. The renegade actor also made $2.7 million from the flash loan attack.

Tether's move to freeze the stolen cash drew a slew of complaints on Twitter from members of the crypto community. 

Ardoino, the company's CEO, replied to the accusations by saying,

 "I'd like to use this opportunity to remind everyone that Tether USDT is a centralized stablecoin that employs blockchains as a transport layer. Tether responsibilities include responding and working with law enforcement and regulators in the event of potentially hazardous behavior.”

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