U.S. investigators are conducting a criminal investigation into Tether, exploring whether third parties have used Tether for illicit activities such as terrorism and hacking. This investigation is being led by the Manhattan U.S. Attorney’s Office. Additionally, the U.S. Treasury Department is weighing potential sanctions against Tether due to its use by individuals and groups sanctioned by the U.S. Should the decision be made to sanction Tether, it would prohibit Americans from conducting transactions with the company.

Source: https://www.wsj.com/finance/currencies/federal-investigators-probe-cryptocurrency-firm-tether-a13804e5

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