- WSJ highlights USDT as the “incognito dollar” for sanctioned countries like Venezuela and Russia.
- USDT is being used for sanction evasion, posing a threat to the US financial system and national security.
- Tether’s profits surpass major financial entities like BlackRock.
- USDT’s role in international transactions is expanding, notably in Georgia.
WSJ: USDT Becomes the “Incognito Dollar” for Sanctioned Countries
The Wall Street Journal has recently published a compelling article revealing how the stablecoin Tether USDt (USDT) has transformed into an “incognito dollar” for countries under sanctions, such as Venezuela and Russia. This development enables these countries to facilitate the free transit of capital across borders, circumventing traditional financial restrictions.
USDT’s Role in Sanction Evasion
The article underscores that USDT’s unregulated nature poses significant threats to the financial system and national security of the United States. Notably, the trading volume of USDT in 2023 has exceeded that of the Visa payment system, highlighting its growing influence.
Moreover, the issuing company Tether has reported a profit of $6.2 billion for the same period, surpassing even BlackRock, the world’s largest ETF provider. Achieving such figures with a workforce of just 100 individuals, Tether’s efficiency and impact are noteworthy.
Case Studies: Venezuela and Russia
The Wall Street Journal article highlights specific instances of USDT usage to bypass sanctions. In Venezuela, the state-owned company Petroleos de Venezuela reportedly uses USDT to pay for oil supplies. Rafael Ramirez, a former oil minister under Maduro’s government, commented that the use of this cryptocurrency has perpetuated a high level of corruption.
In Russia, the activity of Rosbank and individuals like Yekaterina Zhdanova are brought to light. Rosbank facilitates payments in USDT for its clients, while Zhdanova, who was added to the US sanctions list in 2023, allegedly transferred over $350 million in USDT from her wallets.
Global Expansion and Market Impact
The expansion of USDT is rapid and widespread. Tether’s efforts in Georgia are particularly notable, where the firm collaborates with CityPay.io to enable international payments in USDT amounting to around $50 million monthly. According to CityPay.io CEO Eralp Hatipoglu, this surge is driven by the pressure exerted by the US on the global banking system.
Hatipoglu also mentioned that the service meticulously checks participants in transactions, although no evidence was provided to support this claim.
Previously, Tether, TRON DAO, and TRM Labs have joined forces to combat the use of USDT in illegal activities on the TRON blockchain. Remarkably, this network accounts for half of the circulating supply of USDT.
Implications for the Crypto Market
The insights presented by the Wall Street Journal underscore the increasing significance of USDT in the global financial landscape. Its widespread use in sanction-evading transactions raises critical questions about regulatory oversight and the future stability of the financial system. As USDT continues to scale and integrate into various markets, its impact on both the cryptocurrency realm and traditional finance sectors will undoubtedly be profound.
In conclusion, USDT’s evolution into an “incognito dollar” for sanctioned countries like Venezuela and Russia highlights the cryptocurrency’s transformative potential and the urgent need for regulatory frameworks to address these emerging challenges. The ongoing developments will shape the future trajectory of digital assets and their role in global finance.
