Key Highlights:
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US authorities are currently investigating Binance and Tether for potential connections to terrorism financing through violations of sanctions laws.
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Lawmakers are urging swift actions to prevent potential funding for terrorist activities, particularly in the wake of recent attacks.
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Binance is facing scrutiny from the SEC, while Tether recently achieved a legal victory related to its stablecoin's backing.
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United States legislators are increasing legal pressure on cryptocurrency giants Binance and Tether, calling upon the Department of Justice to consider potential criminal charges against them.
Full Article:
US Authorities Probe Binance and Tether Over Terrorism Financing Concerns
Senators Cynthia Lummis and Representative French Hill have jointly issued a letter calling for a thorough investigation into whether Binance and Tether have been involved in terrorism financing through sanctions violations and violations of the Bank Secrecy Act.
During a hearing, Lummis emphasized the importance of regulating "unregulated, centralized" foreign cryptocurrency firms that may be contributing to "significant terrorism financing." In their letter, the lawmakers urged the Department of Justice to take swift action against Binance and Tether, especially in light of recent terrorist incidents in Israel.
The letter specifically asked Attorney General Merrick Garland to make a decision regarding the extent of Binance's culpability and to expedite investigations into illicit activities involving Tether. Both Binance and Tether are prominent players in the cryptocurrency and blockchain industry.
Cryptocurrency Giants Under Legal Pressure as Regulators Take Action
The legal situation escalated when the Securities and Exchange Commission (SEC) filed a lawsuit against Binance.US, its global counterpart Binance, and founder Changpeng "CZ" Zhao. The SEC alleged that these entities were involved in unregistered securities platform operations.
Tether achieved a significant legal victory on August 4 when a class-action lawsuit concerning its USDT stablecoin was dismissed. This case, initiated in December 2021, had raised concerns about the backing of USDT, based on findings from the New York Attorney General (NYAG) and the Commodities Futures Trading Commission (CFTC), as well as Tether's inconsistent statements regarding its reserve holdings.
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