Senator Blumenthal Probes Cantor Fitzgerald Ties to Tether

U.S. Senator Richard Blumenthal has launched an inquiry into the relationship between financial firm Cantor Fitzgerald and stablecoin issuer Tether, sending a formal inquiry to Cantor CEO Brandon Lutnick on Thursday, according to CoinDesk.

Blumenthal, the top Democrat on the Senate Permanent Subcommittee on Investigations, questioned the firm's role in holding and managing Tether's U.S. reserves. The lawmaker requested details regarding Cantor Fitzgerald's safeguards against money laundering and sanctions evasion, specifically citing allegations involving Iran's shadow banking network and Russia.

Scrutiny Over Reserves and Sanctions

Cantor Fitzgerald manages the vast majority of Tether's reserves within the United States, despite Tether operating out of El Salvador. Brandon Lutnick took over leadership of the firm from his father, Howard Lutnick, who stepped down after being appointed U.S. Secretary of Commerce under President Donald Trump.

In his letter, Blumenthal argued that Cantor Fitzgerald has generated substantial profits through interest and investments derived from its partnership with Tether. The lawmaker requested that Cantor describe all steps taken to investigate whether the USDT stablecoin has facilitated illicit financial transactions, as well as information concerning Howard Lutnick's historical dealings with Tether.

Potential Committee Subpoena Powers

While Blumenthal currently operates in the Senate minority, shifting political control could significantly alter congressional oversight. Prediction markets Kalshi and Polymarket show odds of Democrats retaking the Senate majority at 61% and 64% respectively, which would grant committee leaders formal subpoena power to compel testimony and documents.

Neither Cantor Fitzgerald nor Tether immediately responded to requests for comment regarding the congressional inquiry.

Key facts

• Senator Richard Blumenthal sent an oversight letter to Cantor Fitzgerald CEO Brandon Lutnick on Thursday.
• Cantor Fitzgerald serves as the primary custodian managing Tether's reserves in the United States.
• The inquiry questions Cantor's safeguards concerning illicit finance, Iran, and Russian sanctions evasion.
• Prediction platforms Kalshi and Polymarket price the likelihood of a Democratic Senate majority at 61% and 64%.