US Senate Inquiry Targets Cantor Fitzgerald and Tether Ties

A Major Senate Inquiry into Crypto and Wall Street

A major inquiry in the United States Senate is placing Wall Street firm Cantor Fitzgerald under intense scrutiny.

Senator Richard Blumenthal has officially sent a 13-item request for records to Cantor Fitzgerald.

He is demanding details about the firm's lucrative business arrangement with TetherUSDT-0.33%, the creator of USDT.

USDT is currently the world's largest stablecoin, pegged directly to the US dollar to keep digital asset trading moving.

The letter gives Cantor Fitzgerald until October 23 to submit all requested records and document sets.

Who Is Involved in the Investigation?

Senator Blumenthal leads this effort as the top Democrat on the Senate Permanent Subcommittee on Investigations.

He addressed the letter directly to Brandon Lutnick, who currently serves as the chairman of Cantor Fitzgerald.

Brandon Lutnick is the son of Howard Lutnick, the former longtime head of Cantor Fitzgerald.

Howard Lutnick stepped down after the Senate confirmed him as the US Commerce Secretary in February 2025.

The subcommittee probe focuses on the illicit use of crypto assets and potential government self-enrichment.

Massive Profits and Rapid Valuation Surges

The inquiry highlights huge financial figures connected to Cantor's relationship with Tether.

Blumenthal noted that Howard Lutnick made over $250 million since President Donald Trump returned to office.

That personal payout included a massive $192 million distribution paid out directly from Cantor Fitzgerald.

During that same time frame, Cantor's 5% equity stake in Tether saw astonishing growth.

The value of that 5% stake reportedly shot up from $600 million to an estimated $10 billion.

On top of that equity value, Cantor earns tens of millions of dollars each year managing Tether's reserves.

What Role Does Cantor Fitzgerald Play for Tether?

To understand why this relationship matters, it helps to look at how stablecoins stay stable.

Every USDT token in circulation is backed by cash, Treasury bills, and other financial reserves.

Cantor Fitzgerald acts as Tether's custodian, meaning it holds and protects these massive underlying assets.

Senator Blumenthal highlighted an interesting location contrast regarding Tether's actual reserve holdings.

While Tether claims to operate out of El Salvador, most of its wealth sits inside American accounts.

Those reserve funds are safeguarded directly under Cantor's custodianship right here in the United States.

Questions Around Loans and Family Trusts

The Senate request also zeroes in on how Howard Lutnick transferred ownership of Cantor to his children.

Blumenthal asked for terms on any loan strategy that helped move these assets into a family trust.

This request relates to a reported Tether loan given to a trust for Lutnick's four children.

That loan occurred around the exact time the children bought out their father's remaining stake in Cantor.

Senators Elizabeth Warren and Ron Wyden previously raised similar questions about this loan back in April.

When assets move to a trust, the individuals under scrutiny no longer legally own those properties directly.

The 'Tethered to Terrorism' Staff Report

This formal letter arrived 10 days after Democratic staff released a report called 'Tethered to Terrorism.'

The report analyzed 846 crypto wallet addresses targeted for sanctions over links to Iran and allied groups.

It found that 84% of these flagged crypto addresses used USDT exclusively or almost exclusively.

The report broke down its overall findings across two distinct regulatory enforcement lists:

• 87% of 757 addresses flagged by Israel's counter-terror finance bureau used mostly USDT.
• 57% of 101 addresses targeted by the US Treasury's OFAC sanctions office used mostly USDT.

Blumenthal argued that as Tether makes millions from active stablecoin use, Cantor profits right beside them.

Tether's Response and Ongoing Asset Freezes

On the same day the subcommittee report came out, Tether issued an official public statement.

Tether emphasized its proactive security work to stop bad actors from using its stablecoins.

The company reported freezing about $550 million in Iran-linked funds over the past year alone.

That included $344 million frozen in April, followed by over $130 million frozen in July.

Tether can blacklist specific wallet addresses on-chain so funds inside cannot be moved or traded.

However, Tether's official statement did not address the specific details of the Senate staff report directly.

What Specific Documents Must Cantor Provide?

Senator Blumenthal's 13-item request demands extensive internal communications and policy records.

He requested all of Howard Lutnick's records regarding Tether from his time heading Cantor Fitzgerald.

This covers any discussions with White House staff, state regulators, federal officials, or lobbying groups.

The Senate also wants Cantor's Know-Your-Customer (KYC) policies for checking compliance and anti-money-laundering rules.

Additionally, Blumenthal asked if Cantor ever considered cutting ties with Tether due to regulatory risks.

Finally, the letter requests all communications with the President's Council of Advisors on Digital Assets.

Understanding the Scope of the Letter

It is important to note the precise legal nature of this request sent to Cantor Fitzgerald.

This document is an official information request, not a legally binding court subpoena.

The letter does not accuse Cantor Fitzgerald of breaking any specific laws or regulations.

Furthermore, none of the contents represent formal legal findings of guilt or wrongdoing.

Instead, the claims reflect Blumenthal's ongoing probe, built on news reports and staff investigation work.

Cantor Fitzgerald has until October 23 to respond and must preserve all relevant documents in the meantime.