- Tether, a leading stablecoin issuer, is collaborating with blockchain analysis firm Chainalysis to develop a solution for monitoring secondary market transactions involving USDT.
- The new solution will provide enhanced oversight of the USDT market, allowing compliance professionals and investigators to identify risky wallets and transactions linked to illicit and sanctioned addresses.
- This development follows reports of Tether’s USDT being used in illegal activities in East and Southeast Asia.
Tether partners with Chainalysis to develop a monitoring solution for secondary market transactions involving USDT, enhancing market oversight and combating illicit activities.
Tether and Chainalysis Join Forces
Tether, a prominent stablecoin issuer, is joining forces with blockchain analysis firm Chainalysis. The partnership aims to create a solution for monitoring transactions involving entities beyond those that directly buy and sell USDT. Tether believes that this customizable solution for monitoring secondary market activities will offer an enhanced understanding and oversight of the USDT market.
Enhanced Market Oversight
The new platform will serve as a valuable source of intelligence for compliance professionals and investigators. It will enable them to identify wallets that pose risks or may be associated with illicit and sanctioned addresses. The platform’s suite of tools includes “Sanctions Monitoring,” which lists addresses and transactions involving sanctioned entities, and “Categorizations” which can break down USDT holders by type. It also features a tool for “Largest Wallet Analysis,” providing an in-depth examination of significant USDT holders and their activities, and an “Illicit Transfers Detector” that can help in identifying transactions that may be associated with illicit categories.
Combatting Illicit Activities
This development comes in the wake of a report from the United Nations Office on Drugs and Crime (UNODC) in January that alleged money launderers and fraudsters in East and Southeast Asia prefer to use Tether’s USDT in their illegal activities. Blockchain intelligence company TRM Labs also reported that USDT was the most used dollar-pegged token for illicit transactions in 2023. Tether previously stated that its collaboration with law enforcement authorities and the monitoring of USDT make the stablecoin an impractical choice for illicit transactions.
Conclusion
This collaboration between Tether and Chainalysis marks a significant step towards establishing transparency and security within the cryptocurrency industry. By providing enhanced oversight of the USDT market, the new solution will play a crucial role in identifying and combating illicit activities. This move not only strengthens Tether’s commitment to market transparency but also underscores the growing importance of advanced blockchain analysis in the crypto space.
