Senator Richard Blumenthal, the ranking Democrat on the investigations subcommittee, has launched a new probe into Tether's business relationships following reports of payments to a firm owned by former White House crypto adviser Bo Hines. According to reports from The Wall Street Journal, Blumenthal sent letters to both Tether and Nxum Group, the consulting company co-founded by Hines with his father and another partner. The investigation centers on large payments for consulting work that Nxum received while Hines was still advising President Donald Trump on crypto policy.
The latest developments reveal significantly higher financial stakes in the alleged arrangement, with reports indicating that Nxum Group received $6.8 million tied to its arrangement with Tether. As per The Wall Street Journal, the first payment described as having gone through while Hines was still in the White House. This substantial financial figure represents a dramatic increase from previous reports and raises even more serious questions about the nature and scope of the consulting relationship between Tether and the former administration official.
Tether has until early November to clarify its $6.8M payouts to Nxum Group, as demanded by Senator Blumenthal. According to AMBCrypto, Blumenthal has requested that Tether submit all payments to Bo Hines, including the crypto wallet addresses used, between January and August 2025. The Senator also asked for documentation of all lobbying services Nxum offered Tether and clarification on the arrangement with third-party marketing firm Notorious. These comprehensive documentation requirements aim to address ethics and corruption concerns raised by the alleged multimillion-dollar payments to a firm controlled by a former White House official responsible for cryptocurrency policy.
The investigation gains significance as prediction market Kalshi gives Democrats a 69% chance of taking back the Senate chamber. As reported by The Wall Street Journal, if Blumenthal returns to chair the investigations subcommittee, it would grant him significantly greater powers to subpoena and control the agenda. Blumenthal has made it clear that crypto would be high on his list of topic areas if he regains control of the subcommittee, positioning him to continue his comprehensive examination of the cryptocurrency industry.
Tether acknowledged knowing the allegations, which were first reported by the Wall Street Journal in mid-October, but denied the claims and any wrongdoing. According to AMBCrypto, the stablecoin issuer cited that external counsel previously conducted an in-depth internal investigation into the matter, which found no evidence of wrongdoing. Despite growing regulatory scrutiny, USDT adoption has continued to rise, especially overseas, with total USDT users crossing 700 million for the first time in Q3, translating to 6% quarterly growth. Over $70 billion or 39% of USDT supply is now dominated by savers, underscoring that the stablecoin goes beyond just payments.
