Tether Clients Accessed US Banking System Through Signature Bank’s Platform
Tether allegedly allowed its clients to send funds through Signature Bank’s payments platform, giving the firm access to the US banking system. Sources reportedly claim that Tether instructed its users to send dollars through Signature’s Signet to its Bahamian partner Capital Union Bank. This system was reportedly in place at the time regulators took control of Signature in March. Tether’s arrangement with Signature Bank, while potentially not illegal, raises concerns about high-risk practices given that the information was not disclosed to the public.
On March 12, the New York Department of Financial Services took control of Signature Bank and announced its shutdown. Tether’s chief technology officer said the firm had no exposure to the failed bank, while a Tether spokesperson claimed that banks used by the stablecoin issuer always had access to several banking channels and counterparties, and associate entities would not be affected by exposure to Signature, either direct or indirect.
