Tether stablecoin issuer and Tron launch financial crime unit

Tether ( USDT ) stablecoin issuer has joined forces with Justin Sun-founded Tron network and the blockchain intelligence firm TRM Labs to establish a new private financial crime unit.

Called the T3 Financial Crime Unit (T3 FCU), the financial crime unit aims to promote public-private collaboration to combat illicit activity associated with the use of USDT on the Tron blockchain, the firms said in a joint announcement on Sept. 10.

The collaboration will combine TRM Labs’ anti-financial crime expertise and proprietary technology with technical expertise from Tron, while Tether is expected to contribute through its external investigations team.

T3 FCU freezes more than $12 million in USDT associated with illicit activity

As part of the cooperation, the T3 FCU will focus closely on identifying transactions connected to alleged illegal activities such as terrorism, sanctions evasion, theft, hacking, cybercrime and fraud.

Announcing the official T3 FCU launch today, the companies said they have already taken steps on their mission to make the crypto industry safer and more secure. The FCU stated:

“In the weeks since launch, the initiative, in collaboration with law enforcement, facilitated the freezing of over USDT 12 million in funds associated with a blackmail scam, an investment fraud scheme, and others.”

Tron remains the biggest blockchain network for USDT

Tron’s involvement in the T3 FCU is a natural step for the network, given its significant role in minting the USDT stablecoin.

As of Sept. 10, the Tron blockchain remains the biggest network for the USDT stablecoin, with the total circulating amount of Tron-based USDT standing at $60.8 billion. According to Tether Transparency, this amount accounts for 51% of all $118 billion in circulated UDST.

USDT on Tron, Ethereum, Cosmos and EOS as of Sept. 10, 2024. Source: Tether Transparency

According to Tron founder and CEO, the platform’s collaboration with TRM Labs and Tether will help to ensure that “blockchain technology is used to make our world a better place.” It also “sends a clear message that illicit activity is not welcome in our industry.”

Competitors like USDC stablecoin ceased Tron support earlier this year

USDC ( USDC ), a major UDST rival, ceased support for the Tron network in February 2024, with the issuing firm Circle citing “efforts to ensure that USDC remains trusted, transparent and safe.”

The move came subsequently after the Southeast Asia and the Pacific division of the United Nations’ Office for Drugs and Crime argued that USDT is a primary vehicle for money laundering in the region. The report specifically highlighted the growing popularity of USDT based on the Tron blockchain .

Tron founder Justin Tron. Source: Forbes

Tether subsequently responded to the UN’s report, emphasizing that the agency’s analysis “ignored the traceability” of USDT and disregarded its proven record of collaborating with law enforcement worldwide.

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The stablecoin firm also declined to tell whether it was planning to keep Tron support for USDT in February but eventually continued minting new USDT on the blockchain.

Since February 2024, Tron-based USDT added at least $10 billion in authorized minting or more than 20%. On Aug. 20, Tether minted another 1 billion USDT tokens on the Tron network.

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