Stablecoin issuer Tether is accused of using collapsed Signature bank to access the U.S. banking system as it doesn’t have direct access to it.
Bloomberg reported, “Tether instructed crypto clients to pay for its stablecoins by sending dollars to its Bahamas-based banking partner Capital Union Bank Ltd. via Signature’s Signet payments platform,” as per people familiar with the situation.
The insiders noted that although the beginning of Tether’s arrangement with the collapsed platform is unknown, it was already in place when regulators seized Signature Bank last month.
Also Read: A Criminal Investigation Was Underway Before Signature Bank Collapsed
Tether Chief Technology Officer (CTO) Paulo Ardoino slammed the Bloomberg report saying “As I stated on 12th of March 2023, Tether didn’t have any direct or indirect exposure to Signature. Good risk management where everyone failed.”
A Tether spokesperson noted that banks used by the platform “always had access to several banking channels and counterparties and associate entities wouldn’t be affected by either direct or indirect exposure to Signature.” This enabled them to identify particular risks and weaknesses that others had missed, ensuring their entities wouldn’t be affected by either direct or indirect exposure to Signature.
Also Read: Tether Under Scrutinty for Opening Bank Accounts with Fake Documents
