Sen. Blumenthal asks Tether to explain payments to ex-White House crypto adviser's firm

Senator demands records on Tether's ties to crypto adviser

Senator Richard Blumenthal has asked Tether to provide records regarding its business dealings with Nxum, a consulting firm founded by Bo Hines and his father. Hines served as the White House's top crypto adviser.

In a letter sent on Thursday, the Connecticut Democrat stated that Tether's alleged multimillion-dollar payments to the firm raised legal and ethical concerns. The payments reportedly occurred during negotiations to pass stablecoin legislation into law. A stablecoin is a digital currency designed to maintain a constant value, usually pegged to the U.S. dollar.

Key details of the inquiry

• The Wall Street Journal reported that Tether began working with Nxum weeks after Hines became the White House crypto adviser.
• Blumenthal also sent a letter to Nxum, noting that Harry Jung, a former White House crypto official, now works at the firm.
• The senator asked Tether to provide records involving its business dealings with both Nxum and Hines.
• Blumenthal said the payments implicated federal ethics, anticorruption, and lobbying laws.

Tether's response to the letter

A spokesperson for Tether told The Block that the company is reviewing the letter. The spokesperson said Tether is aware of the allegations reported by The Wall Street Journal that form the basis of the senator's inquiry.

Tether stated that external counsel previously conducted an in-depth internal investigation into the matter. According to the spokesperson, that investigation found no evidence of wrongdoing.

What is confirmed

The letter from Senator Blumenthal has been confirmed by The Block. The Wall Street Journal reported that Tether started a business relationship with Nxum. Bo Hines played a pivotal role in passing the GENIUS Act, which created the first federal regulatory framework for stablecoins. Tether launched a U.S.-based version of its stablecoin, called USAT, through this legislation.

Why this matters for crypto regulation

Lawmakers have increasingly scrutinized Tether over the past year. Last month, Blumenthal released findings from an investigation claiming Tether had become central to Iran's shadow banking system. Tether has pushed back against these claims, stating it helps authorities find bad actors. The current inquiry focuses on whether a major stablecoin issuer is improperly doing business with a top government crypto official, which could influence how future regulations are enforced.