U.S. Senator Richard Blumenthal has opened another Tether-related inquiry, this time centered on reported payments to Nxum Group, a firm owned by former White House crypto adviser Bo Hines.
Blumenthal, the ranking Democrat on the Senate Permanent Subcommittee on Investigations, is seeking answers after recent reports said Nxum took millions of dollars from Tether while Hines was still helping shape crypto policy in the White House, including policy affecting stablecoin issuers important to Tether.
Letters sent to Tether and Nxum Group
On Thursday, Blumenthal sent letters to Tether and to Nxum Group, the consulting firm Hines started with his father and another partner. Hines later took a role as Tether’s top U.S. executive after leaving the White House.
In his letter to Tether CEO Paolo Ardoino, Blumenthal wrote: 「The highly unusual terms and nature of Tether’s business relationship with both Nxum and Bo Hines raise alarming ethical and legal concerns, indicating that Tether was likely well aware of the illegality and impropriety of issuing payments to a current White House official with such a direct role in shaping cryptocurrency legislation that was instrumental to its business.」
The Wall Street Journal reported last week that Nxum received large payments for consulting work for Tether while Hines was still advising President Donald Trump and his administration on crypto policy. Blumenthal asked for details of those business arrangements.
Spokespeople for Tether did not immediately respond to requests for comment.
Earlier reporting tied Hines’ company to Tether-linked political work
CoinDesk had previously reported that Hines’ company, despite having little track record or experience in politics, was making millions of dollars as the main campaign advertising provider for a political action committee associated with Tether.
Nxum has also recently hired Harry Jung, another former White House crypto adviser. The White House office that advised Trump on crypto issues has remained vacant since Patrick Witt, who replaced Hines as executive director, departed.
Part of a broader crypto focus from Blumenthal
Blumenthal has been devoting substantial attention to crypto matters. His recent targets have included Trump’s memecoin, crypto backers of the president’s projects, the Trump family’s crypto firm World Liberty Financial, activity at Binance, and Tether in particular.
He previously issued a report on Tether’s financial connections to Iran. More recently, he also demanded answers about Tether’s relationship with its U.S. financial partner, Cantor Fitzgerald.
Ardoino criticized Blumenthal’s work earlier this week, saying the senator ignored important information and shared his report with the press before the company had a chance to review it or respond.
Senate control could shape the next phase
Democrats have remained in the Senate minority during Trump’s time in office, but recent weeks have improved the odds of the party taking back the chamber. If Blumenthal returns as chair of the investigations subcommittee, he would gain much broader subpoena power and greater control over the panel’s agenda. He has already made clear that crypto would rank high among his priorities.
Prediction market Kalshi currently gives Democrats a 69% chance of retaking the Senate.