Tether e TRON establish a unit against crimes

A few days ago Tether announced the launch of a new unit against crimes together with Tron and TRM Labs.

This is the so-called T3 Financial Crime Unit (T3 FCU), and it is the result of a public-private collaboration to combat illicit activities associated with the use of USDT on the Tron blockchain. 

Tether and Tron against crypto crimes

For some time now, the majority of transactions in USDT, the stablecoin of Tether, have been taking place on Tron. 

Initially USDT, back in 2014, was launched on Omni, a chain based on the Bitcoin blockchain. Later, however, it was also launched on Ethereum, where it found much wider use.

The Ethereum blockchain, however, does not have very low fees on transactions, and so Tether decided to make its stablecoin available also on more economical blockchains, such as Tron. 

Currently, USDT is present on as many as 16 blockchains, including Omni, Ethereum, and Tron, and on various layer-2s. 

Of the approximately 118 billion USDT tokens, almost 62 billion are on Tron, while on Ethereum there are less than 54. Omni has now been surpassed by Solana and Avalanche, with TON growing significantly. 

The unity against crimes: Tether and Tron collaborate

T3 FCU, in addition to Tether and Tron, also and above all involves TRM Labs, one of the main blockchain intelligence companies with expertise in the fight against financial crimes. Tron has on-chain technical skills, and Tether will make its external investigations team available. 

The unit was already created some time ago, and Tether states that in the weeks following the launch, the initiative has already facilitated the freezing of over 12 million USDT, in collaboration with law enforcement, in funds associated with scams and fraudulent investment schemes. 

TRM will provide continuous support to Tron and Tether in identifying transactions that have a connection with alleged illegal activities, such as financing terrorism, sanctions evasion, thefts, hacking, cybercrime, and fraud. The work will support Tron and Tether’s efforts to disrupt criminal activity and assist collaborations with law enforcement agencies worldwide.

USDT

Tether in the official statement also claims that stablecoins like USDT are the backbone of the digital asset sector, because they provide a stable store of value and allow smooth movements of funds between platforms. 

Furthermore, it does not deny that the same characteristics that make USDT attractive to legitimate users also attract the attention of fraudsters, terrorism financiers, and other criminal entities. 

So if on one hand the popularity and user base of USDT on Tron grow, on the other hand its unwanted exposure to such criminal subjects also grows. 

T3 FCU aims to take a significant step towards preventing the ability of malicious actors to launder and use the proceeds of crime using USDT, thus safeguarding the integrity of the Tron blockchain.

The alternative dollar and parallel finance

Just a couple of days ago, the famous Wall Street Journal (WSJ) published an article precisely on USDT in which it defines it as “The alternative dollar that fuels a parallel financial world.”

In the article, the WSJ states that USDT now rivals Visa in transaction volume, handling up to 190 billion dollars per day, and despite Tether having fewer than 100 employees in 2023, it has even surpassed BlackRock in terms of profitability, earning 6.2 billion dollars.

Despite Tether often collaborating with law enforcement, the WSJ claims that its activities undermine the efforts of the USA to combat arms traffickers, sanctions violators, and fraudsters, because it allows a parallel economy outside the reach of US law enforcement.

It also claims that it is controlled by a secret group of owners, while instead the owners and managers of Tether are well known, starting with the CEO Paolo Ardoino. 

The American newspaper admits that Tether is able to trace every USDT transaction on the public blockchain, and can seize the tokens and block the wallets, but states that this block has proven largely ineffective. In fact, out of 153 billion dollars in 2,713 wallets added to the blacklist, Tether would have managed to block only 1.4 billion dollars in total, while the rest was moved or withdrawn before the block. 

Probably it is also for this reason that the T3 FCU unit was established, that is, to try to make the intervention of the authorities for seizures easier and faster. It should not be forgotten that Tether does not arbitrarily block wallets, but intervenes upon explicit and precise request from the authorities. The process must be facilitated in order to be sped up to make it truly effective.