Senate Probe Targets Tether Over White House Adviser Deal

Senate Opens Investigation into TetherUSDT+0.15% Payments

A senior U.S. lawmaker is raising serious questions about how crypto stablecoin issuer Tether interacted with a former White House official. Senator Richard Blumenthal, a Democrat from Connecticut, sent an official letter on Thursday to Tether Chief Executive Officer Paolo Ardoino.

Senator Blumenthal serves as the top Democrat on the Senate Permanent Subcommittee on Investigations. In his letter, he gave Tether a firm deadline of November 3 to turn over full financial records regarding its business dealings with Bo Hines and his consulting firm, Nxum.

Who Is Bo Hines and Why Does It Matter?

Bo Hines played a major role in shaping cryptocurrency policies at the highest level of the United States government. He served as executive director of President Donald Trump's Presidential Council of Advisers for Digital Assets. During his time in government, he helped craft the GENIUS Act, a landmark crypto regulatory bill signed into law in July 2025.

Hines officially stepped down from his White House advisory role on August 9, 2025. Just one month later, in September 2025, Tether named Hines as the CEO of its newly created U.S. division.

The Wall Street Journal Investigation

Senator Blumenthal's letter follows an extensive investigation published by The Wall Street Journal on October 14. The report revealed that consulting firm Nxum made $6.3 million from a business deal struck with Tether in May 2025—a period when Hines was still actively serving in the White House.

According to the investigation, Hines co-founded Nxum and maintained a one-third ownership stake while working as a government adviser. The deal reportedly involved Tether paying $415,000 per month to a marketing agency named Notorious.

Notorious then transferred the majority of the initial payment directly into a digital wallet controlled by Nxum, where the funds were split three ways. Once Hines left his White House position, subsequent payments were routed directly to Nxum.

The Journal also uncovered a pitch deck created by Nxum. The presentation suggested that Tether would buy a 25% ownership stake in Nxum for $56 million.

Policy Changes and Internal Messages

Beyond the financial flows, the investigation raised questions about political influence. The Wall Street Journal reported that Hines actively urged lawmakers to extend the compliance timeline in the GENIUS Act from 18 months to 36 months. This extension offered a significant practical benefit to major stablecoin issuers like Tether.

Reviewed text messages showed Hines sharing talking points with his partners at Nxum regarding Republican lawmakers who opposed the legislation. Following a telephone conversation with Tether CEO Paolo Ardoino, Hines' father and Nxum co-owner, Todd Hines, sent a text stating: "They want us to obliterate these members that are fighting crypto."

Responses from Tether, Nxum, and Lawmakers

Representatives for Nxum and Tether have strongly denied any wrongdoing. A Nxum representative stated that Hines was not involved in the Tether arrangement while serving in government and "did not receive any Tether-derived funds during that period."

Tether also issued an official statement acknowledging the inquiry. The company noted that external legal counsel had previously conducted an in-depth internal investigation into the matter and found no evidence of any wrongdoing.

However, Senator Blumenthal expressed deep concern in his letter. He stated that the payment structure suggests Tether "was likely well aware of the illegality and impropriety" of paying a sitting official. He added that the arrangement touches on federal ethics, anti-corruption, and lobbying laws.

Broader Senate Scrutiny Surrounding Tether

This inquiry marks the second time this month that Senator Blumenthal has targeted Tether's U.S. financial connections. On October 8, the Senator sent a separate letter to Cantor Fitzgerald, the financial institution that serves as Tether's primary reserve custodian and holds a 5% ownership stake in the firm.

Cantor Fitzgerald is chaired by the son of Commerce Secretary Howard Lutnick. Blumenthal's request followed a congressional staff report alleging that many Iran-linked digital wallets frequently used Tether's USDT stablecoin.

Tether responded to those findings by pointing out its ongoing cooperation with law enforcement. The firm highlighted that it has frozen approximately $550 million worth of tokens connected to Iran, including $344 million frozen in April alone.

Political debate surrounding Tether has reached high levels of government before. Commerce Secretary Howard Lutnick defended Tether during his Senate confirmation hearing last year. Meanwhile, Senators Elizabeth Warren and Ron Wyden questioned Lutnick in April over reports of a Tether loan provided to a trust benefiting his children.