According to Bloomberg, Tether, the world’s largest stablecoin issuer, utilized Signature Bank to transfer funds from the United States to the Bahamas.
Money was routed through the Bank’s Signet system
Tether transferred funds from U.S. clients to Capital Union Bank, the issuer’s Bahamas-based banking partner. The transfers happened via the Signet payments platform of Signature Bank before the bank went out of business in March, and regulators took it over.
People with knowledge of incident claim that Tether paid crypto users for its stablecoins. Tether allegedly sent dollars to its Bahamas-based Capital Union Bank Ltd. banking partner through Signature’s Signet payments platform.
Signet, a real-time payments network that launched in 2019 and was a crucial piece of technology for many institutional clients in the crypto space, such as the exchanges Coinbase and Kraken, is still operating today despite the bank being closed down by regulators.
Paolo Ardoino refuted the allegations
Paolo Ardoino, the chief technology officer at Tether, tweeted in reaction to the piece that his company “didn’t have any direct or indirect exposure to Signature.”
The Wall Street Journal has recently come under fire from Tether for publishing and disseminating inaccurate information about the firm and its operations.
The USDT issuer criticized the Wall Street Journal and other legacy media for publishing negative articles about the company while applauding other crypto businesses, which were some of the biggest financial disasters in history.
The resilience of Tether has been demonstrated during times of market turmoil like the LUNA and FTX crises. The company has shown its ability to keep operating as its customers want it to by successfully processing over $20 billion in redemptions throughout the market’s highs and lows.