(Reuters) -Tether's top executive said on Friday the company has seen no sign it is under investigation, after the Wall Street Journal reported U.S. authorities are probing potential violations by the cryptocurrency firm of sanctions or anti-money laundering rules.
Federal investigators, led by the U.S. Attorney's Office in Manhattan, are scrutinizing whether the cryptocurrency has been used by third parties to fund illegal activities such as the drug trade, terrorism and hacking - or to launder the proceeds generated by them, the WSJ said, citing unnamed sources.
Tether is the world's largest stablecoin, a type of cryptocurrency designed to hold a fixed value over time.
"There is no indication that Tether is under investigation," Tether CEO Paolo Ardoino said on X.
A spokesperson for the U.S. attorney's office declined to comment.
The Treasury Department has been weighing sanctions on Tether because of widespread use by sanctioned individuals and groups, the WSJ report said. The crypto firm has been under investigation for years in connection with potential bank fraud by backers, the report said.
The Treasury Department's Financial Crimes Enforcement Network did not respond immediately to requests for comment.
"The article ... carelessly glosses over Tether’s well-documented and extensive dealings with law enforcement to crack down on bad actors seeking to misuse tether and other cryptocurrencies," Tether said in a statement about the WSJ report.