Tether Operations, the company behind Tether (USDT) — the largest stablecoin by market capitalization — today announced that it will be trialing Notabene’s crypto travel rule compliance product for cross-border stablecoin transfers.
- USDT has a market capitalization of over US$70 billion and over US$64 billion in 24-hour trading volume, according to CoinGecko data.
- In July, the Financial Action Task Force (FATF) — the global anti-money laundering (AML) and counter-financing of terrorism (CFT) standards setter — called on countries to implement travel rule requirements on virtual asset service providers (VASPs) “as soon as possible.” The travel rule requires crypto companies to share specified customer information alongside a transaction over a certain threshold.
- Tether will use Notabene’s product to test sending other VASPs the required information. Tether added that it intends to integrate the product upon successful testing.
- “Because the Travel Rule traditionally applies to financial institutions, we see this as an opportune moment to foster cooperation across traditional and digital channels in order to create better services for customers globally,” said Leonardo Real, CCO of Tether, in a statement.
- Tether has been under increasing regulatory scrutiny. Earlier this month, Tether and its affiliated crypto exchange Bitfinex agreed to pay US$42.5 million to settle charges from the U.S. Commodity Futures Trading Commission (CFTC) over allegedly making misleading statements and illegal transactions. In February, Tether and Bitfinex reached a US$18.5 million settlement with the New York State Attorney General over allegations that they had tried to cover up US$850 million in losses.
- Last week, short-seller Hindenburg Research announced a reward of up to $1 million for information on the reserves that back Tether, calling its disclosures opaque.
- FATF will be publishing its revised guidance on virtual assets and virtual assets service on Oct. 28.
See related article: Crypto travel rule transactions tested between Abu Dhabi, Singapore