Tether, the issuer of the world’s largest stablecoin, has announced that it is working with the blockchain data platform Chainalysis to monitor secondary market activity and combat illegal activities. In an announcement, Tether, which pegs the cryptocurrency “USDT” to the US dollar, said it is launching new monitoring and analysis tools with Chainalysis.

These tools will be able to identify wallets that may pose potential risks or may be associated with illegal or sanctioned addresses. “Tether’s proactive commitment to monitoring the secondary market for USDT – the world’s most popular cryptocurrency – has the potential to transform the entire ecosystem and make it a safer place to transact,” said Jonathan Levin, co-founder founder and chief strategy officer of Chainalysis, in the blog post.

Tether further explained that “secondary market activity” refers to transactions executed within the broader ecosystem using USDT, outside of the limited entities that buy and sell USDT directly from Tether. Developed by Chainalysis, the new tools will allow Tether to “methodically monitor transactions,” giving the company oversight of the USDT market.

The tools will be used by Tether compliance professionals and researchers, allowing them to identify wallets that may pose risks or may be associated with illegal or sanctioned addresses, Tether said.

Earlier this week, Tether reported a record net profit of $4.52 billion in the first quarter of 2024, which is a significant achievement for the company. The significant gain was primarily attributed to the company’s financial gains from Bitcoin and gold, totaling $3.52 billion, and an additional $1 billion from operating profits.

In December, the American credit rating agency S&P Global Inc. that it had begun assessing Tether’s ability to maintain its peg to the US dollar, marking it with a ‘constrained’ rating of 4.

The risk rating is between 1 and 5 – with 5 being rated as weak. Tether received a weak score due to the lack of information provided. Stablecoins are cryptocurrencies whose value is usually tied to a fiat currency or commodity. Tether has been under scrutiny for years – the stablecoin was released in 2014 and is the longest-standing stablecoin with the largest volume in circulation. Its price has remained relatively stable in recent years and especially over the past year, the S&P noted.

Source: https://cryptobenelux.com/2024/05/04/tether-gaat-partnerschap-aan-met-chainalysis-om-transacties-te-monitoren/

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