US Senator Demands Answers From Tether Over Alleged Payments to Former White House Crypto Adviser

Summary

U.S. Senator Richard Blumenthal has demanded records from Tether over alleged multimillion-dollar payments involving former White House cryptocurrency adviser Bo Hines. The Connecticut Democrat raised concerns about Tether’s relationship with Nxum, a consulting firm established by Hines and his father.

According to Blumenthal’s Thursday letter, the reported financial arrangement raises potential questions involving federal ethics, lobbying regulations, and anticorruption laws. The senator wants Tether to disclose records detailing its business dealings with Nxum and communications involving the former government official.

The inquiry follows a Wall Street Journal report describing Tether’s business relationship with Nxum during negotiations surrounding federal stablecoin legislation. Reportedly, the consulting arrangement began weeks after Hines assumed responsibility for cryptocurrency policy within President Donald Trump’s administration.

Hines subsequently played an important role in advancing the GENIUS Act, which established the first federal regulatory framework for stablecoins. Blumenthal argued that payments involving an official responsible for cryptocurrency policy warranted scrutiny under federal ethics and lobbying requirements.

“Tether’s alleged multimillion-dollar payment to a firm controlled by the White House official primarily responsible for cryptocurrency policy implicates federal ethics, anticorruption, and lobbying laws,” Blumenthal wrote.

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Tether Responds to Allegations as Senator Expands Investigation Into Nxum Dealings

Tether acknowledged receiving the senator’s letter and confirmed that its representatives were reviewing the allegations surrounding the consulting arrangement. A company spokesperson explained that external legal counsel previously conducted an extensive internal investigation into the reported business relationship.

According to Tether, that investigation found no evidence of wrongdoing involving the company or the reported consulting payments. Meanwhile, Blumenthal also contacted Nxum directly, requesting information concerning its operations and financial dealings with the stablecoin issuer.

The investigation comes amid growing congressional scrutiny of Tether’s operations, including concerns surrounding illicit financial activity involving its stablecoin.

Congressional Scrutiny Intensifies Over Tether’s Operations and White House Connections

In September, Blumenthal released findings alleging that Tether played a significant role in Iran’s shadow banking network. Those findings also raised concerns about cryptocurrency transactions connected to terrorist financing, allegations that Tether has repeatedly challenged.

Tether maintains that its cooperation with law enforcement helps authorities identify illicit actors and investigate suspicious cryptocurrency transactions. Separately, Nxum has recruited Harry Jung, who previously served as deputy director of the President’s Council of Advisors for Digital Assets.

The council has also experienced leadership departures, including Patrick Witt, whose government assignment ended before announcing plans to enter the private sector. Tether previously supported the GENIUS Act and subsequently introduced USAT, a U.S.-based version of its flagship stablecoin.

Blumenthal’s requests now place the company’s consulting relationship with Nxum under additional congressional examination as lawmakers seek details about the reported payments.

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