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Stablecoins were supposed to be crypto’s most regulator-friendly product, yet this week a Senate report placed USDT at the center of Iran’s sanctions evasion, just as Washington writes the rules that will decide which issuers get to operate in the US. The tension is that the same transparency and freeze powers Tether cites in its defense are exactly what make its failures to act look like choices.
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In Today’s Edition:
**Headline:Senate Report Ties USDT to IranQuick Bites:Binance Deal Gives Circle a Boost in Stablecoin RaceYield of the Week:**gUSDC Vault’s 49.91% APY
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HEADLINE
**State of play: **A Democratic-led Senate report casts Tether’s USDT as the backbone of Iran’s shadow banking system, turning a compliance critique into a political one by asking whether Tether’s ties to the Trump administration have bought it lighter oversight.
Investigators analyzed 846 Iran-linked wallets and found 87% of 757 tied to terrorism financing mainly transacted in USDT.
The report says Tether repeatedly failed to freeze wallets showing strong public signs of illicit finance, even without formal sanctions notices.
Blumenthal urged Attorney General Todd Blanche and Treasury Secretary Scott Bessent to probe potential sanctions and banking law violations.
It cites Commerce Secretary Howard Lutnick’s former firm Cantor Fitzgerald as Tether’s custodian and ex-White House crypto official Bo Hines as Tether US CEO.
Tether says it helped freeze $550M in Iran-linked USDT over the past year and acts when law enforcement provides credible information.
**What’s Next: **As a minority report, its impact hinges on whether Blanche and Bessent open probes, a politically fraught call given the administration ties the report itself highlights.
**Why it Matters: **USDT is the largest stablecoin, and sanctions exposure at this scale could shape how regulators treat offshore issuers once the GENIUS Act takes effect in January 2027.
**Our Take: **Tether’s $550M freeze tally cuts against its own defense, since proving it can freeze makes every ignored red flag a choice rather than a limitation.
QUICK BITES
Binance dealgivesCircle a boost in stablecoin race with Tether, analysts say.Senate ReportsaysTether’s USDT at center of Iran’s shadow banking network.CitiexpandsCoinbase partnership to power stablecoin payments for businesses.
YIELD OF THE WEEK
The vaultaccepts USDC deposits and issues gUSDC tokens representing ownership in the liquidity pool, acting as the counterparty to all trades on the Gains perpetuals platform, with ~$4.82M in TVL and a 97.9% collateralization ratio.Capital is deployed as counterparty liquidity to traders on Gains Trade, with gUSDC accumulating trading fees in real-time across all platform trades at a current price of 1.32771 USDC per gUSDC.
Yield is generated from trading fees paid by perp traders on the platform, delivering a 49.91% APY, with withdrawals following an epoch system with the current epoch ending September 30, 2026.
The vaultaccepts USDC deposits and runs a delta-neutral FX arbitrage strategy on the USD/TRY carry trade, with ~$2.3M in deposits against a $30M capacity cap, while also earning PIKU rewards and ACC points.Capital is deployed into aFXArbUSDTRY positions via looping strategies on Morpho, with max looping APYs of up to 130.61% against RLUSD and 95.99% against USDC collateral.
Yield is generated from FX carry arbitrage between USD and TRY, with a 13.77% native USDC return boosted by 16.14% in PIKU rewards and ~1.5% ACC points, net of a 0.41% performance fee, delivering a 31% total APY since inception.
The vaultaccepts reUSD/scrvUSD Curve LP token deposits and automatically compounds trading fees and CRV emissions from the reUSD/scrvUSD Curve pool, with ~$1.55M in TVL and a 30-day APY of 15.9%.Capital is fully deployed into the CurveBoostedFactory-reusdscrv strategy at 100% allocation with a 2.50x boost, earning boosted CRV rewards through Curve’s gauge system on the Resupply reUSD and Curve Savings crvUSD stable pair.
Yield is generated from Curve trading fees and CRV gauge emissions, compounding automatically through share price appreciation at 20.8% APY, net of a 10% performance fee and 0% management fee.
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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.
