Sen. Richard Blumenthal is continuing to examine Tether’s financial relationships, sending a letter to Cantor Fitzgerald CEO Brandon Lutnick that asks for information about the firm’s ties to the stablecoin issuer.
Brandon Lutnick is the son of U.S. Commerce Secretary Howard Lutnick, who handed over leadership of the company when he left to join President Donald Trump’s administration. Cantor holds and manages Tether’s reserves in the United States, and the two companies also share other business interests, according to the report.
Blumenthal asks Cantor to detail its relationship with Tether
Blumenthal, the top Democrat on the Senate Permanent Subcommittee on Investigations, is seeking answers about the connection between Cantor Fitzgerald and Tether, the world’s largest stablecoin issuer. The report says that if Democratic momentum continues into the November election and the party retakes the Senate majority, he and his colleagues could soon be operating with more authority behind such probes.
He sent the letter on Thursday to Brandon Lutnick. CoinDesk reported that Blumenthal has already been scrutinizing Tether’s role in Iran’s financial system and is now highlighting the lucrative business relationship between the issuer of USDT and Cantor, the firm that handles its U.S. reserves.
In the letter, Blumenthal wrote: “Just as Tether has made untold millions in interest and investments from the stablecoins used in these illicit activities, so has Cantor Fitzgerald profited from its relationship with Tether.” He questioned Lutnick about the company’s banking and sanctions safeguards and also asked about his father’s history with Tether.
The Connecticut lawmaker also wrote: “While Tether claims to operate out of El Salvador, the vast majority of its assets reside in the United States under your custodianship. As Congress considers how to best regulate digital assets, your partnership with Tether will provide important insights into the inner workings of this industry.”
Letter focuses on Iran shadow banking and Russia sanctions evasion
Among the requests in the letter was this question: “Please describe all steps Cantor Fitzgerald has taken to investigate allegations that Tether’s stablecoin has been used in illicit finance and money laundering, including within Iran’s shadow banking network and for purposes of Russia sanctions evasion.”
Neither Cantor Fitzgerald nor Tether immediately responded to requests for comment sent to their spokespeople, according to the report.
Election outcome could change the scope of congressional oversight
The report says Blumenthal and other congressional critics of the crypto industry, including Sen. Elizabeth Warren, have been limited by their status in the minority party. That could change if Democrats secure a Senate majority next year.
If Democrats win several more seats in the chamber, they could end up leading committees with subpoena power, giving them the legal ability to compel information and testimony.
Prediction markets show improved odds for Democrats
As of now, prediction markets suggest Democrats have better-than-even odds of returning to the Senate majority. Kalshi puts the probability at 61%, while Polymarket shows 64%. The report notes that the figure was closer to 50-50 several weeks ago.
The outlook in the U.S. House of Representatives is described as even more favorable for Democrats, with both platforms showing the likelihood of a majority shift at more than 90%.