Tether Enlists Startup to Help It Comply With Money Laundering Rules
Stablecoin issuer Tether announced on Tuesday that it has begun a trial partnership with Notabene to help it combat money laundering in cross-border transactions.
The partnership with the startup, which provides software to crypto exchanges to help them identify their users and track transactions, will help Tether to comply with the Financial Action Task Force’s (FATF) “travel rule,” which requires financial institutions to exchange customer information for both senders and recipients of relevant transactions.
The FATF is a Paris-based global, money-laundering watchdog. Its guidelines for crypto compliance have expanded to include exchanges and stablecoin issuers, which are known as virtual asset service providers, or “VASPs”.
Tether’s trial partnership with Notabene comes as the stablecoin issuer wrestles with probes and lawsuits from regulators over its financial reserves and accusations from the crypto community that it has not been transparent.
Leonardo Real, Tether’s chief compliance officer, said the partnership with Notabene is meant to help Tether improve its global regulatory compliance and transparency, and to improve its products.
“As pioneers of blockchain technology and leaders in transparency, we are dedicated to not only keeping up with new rules but helping shape them,” Real said in a statement.
“Because the travel rule traditionally applies to financial institutions, we see this as an opportune moment to foster cooperation across traditional and digital channels in order to create better services for customers globally,” he said.
