| Tether holds $114.9 billion in Treasurys, more than Israel, and made $1.5 billion in one quarter. |
| LEAD ESSAY / 4 MIN / 4 DOCUMENTS / STORY FILE TETHER-CNTR |
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| Who collects when the Fed raises rates? |
| I'd have said the banks, and I'd have been half right. So does Tether. You've probably never held its token, but it owns more of your government's debt than Israel does. And the firm that holds those Treasurys for it is run by the sons of the Commerce Secretary. |
| Let me walk you through how that works. Tether issues USDT, a stablecoin. In plain English, that's a digital dollar you can send over the internet. Buyers hand over a dollar and get a token back. Then Tether puts that dollar into Treasury bills, which are short loans to the government that pay interest. So the token holder earns nothing, while Tether keeps the interest... |
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Howard Lutnick and a 5% stake |
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| Cantor Fitzgerald became Tether's custodian in 2021. A custodian is the firm that holds assets on an owner's behalf. Lutnick ran it back then, and he helped negotiate a convertible bond deal worth up to $600 million. That's a loan that can turn into ownership. This one carried the right to 5% of Tether, two senators wrote in April. |
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| There's a company that I like called Tether. |
| HOWARD LUTNICK, VIA DL NEWS |
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| He said that at Davos in 2024, a year before he joined the Cabinet. By February 2025 he was Commerce Secretary, and he agreed to sell his Cantor stake. His own children bought it, and the sale closed on October 6, 2025. One day later, a credit filing in New York showed Tether had lent money to Dynasty Trust A, Bloomberg reported. Four Lutnick children are its beneficiaries, and the trust holds more than half of Cantor. Every asset it owns secures the loan, yet the size of that loan hasn't been disclosed... |
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The Senate report, 28 pages |
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| Now look at what came out on September 28. Senator Richard Blumenthal is the top Democrat on the Senate Permanent Subcommittee on Investigations. Members of his staff wrote a report on Tether and Iran, and they called it Tethered to Terrorism. |
| FILED / SENATE PSI MINORITY STAFF REPORT |
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| Staff traced 846 crypto wallets that US or Israeli authorities sanctioned or marked for seizure over ties to Iran and its proxies. Of those, 84% dealt only, or almost only, in Tether's token. Two wallets tied to Iran's central bank took in nearly $50 million in USDT in the spring of 2025. When the report came out, Tether had not answered the panel's June 4 letter. |
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| Read the part about the central bank again. Iran used Tether's token to support the rial, its currency, while sanctions blocked its banks from global payment systems. The report also counts about $114.9 billion in Treasurys at Tether, which is more than the UAE or Israel holds. And it names Cantor as Tether's main custodian for those Treasurys. |
| I'll be fair to Tether here. It says it has frozen about $550 million in Iran-linked tokens this year, the Spectator reported. Its authors are also one party's staff. But the wallets it studied came straight off US and Israeli sanctions lists. |
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$1.5 billion in one quarter |
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| Here's where your money comes in. For the second quarter, Tether reported about $1.5 billion in operating profit, driven by its Treasurys and repo, CoinDesk reported. Repo is a short loan backed by government bonds. Higher rates mean more of that income, and the Fed raised rates in September. |
| You can read the Senate report yourself, and I'd start on page 7, where Cantor's name appears. Warren and Wyden sent Tether seven questions on April 29 and asked for answers by May 13. My search this week turned up no public reply... |
| So here's your stake in it. Interest on Treasury bills comes out of the federal budget, and your taxes fill that budget. Part of that interest goes to Tether. Tether's bonds sit at a firm run by the Commerce Secretary's sons. On top of that, his children's trust borrowed from Tether, in an amount that's still secret. Meanwhile you're paying for a war with Iran, whose central bank bought the same token to defend its currency. |
