As Democrats steadily rise in their potential to take back a Senate majority in the upcoming elections, Senator Richard Blumenthal is digging deep into Tether’s U.S. financial partnership. The top Democrat on the Senate Permanent Subcommittee on Investigations has initiated a rigorous inquiry, demanding comprehensive answers regarding the intricate ties between financial giant Cantor Fitzgerald and Tether, the undisputed worldwide leader in stablecoins. With political momentum shifting ahead of the November elections, Blumenthal and his congressional colleagues may soon wield significantly more institutional authority to back up such high-stakes financial probes.
Blumenthal sent an official and pointed letter to Cantor’s CEO, Brandon Lutnick, who stepped into the role after his father, Howard Lutnick, handed over the company reins to join the administration of President Donald Trump as the U.S. Secretary of Commerce. Senator Blumenthal has spent recent months aggressively scrutinizing Tether’s alleged role in facilitating illicit financial activities, specifically highlighting its connections to Iran’s shadow banking network. In his latest correspondence, the lawmaker turned his attention to the exceptionally lucrative business partnership connecting the issuer of USDT—the world’s most traded stablecoin—to the U.S. financial firm responsible for holding and managing its vast reserve assets.
"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," Blumenthal wrote in his letter. In addition to demanding details regarding Cantor’s internal banking mechanisms and regulatory sanctions safeguards, the senator pressed Lutnick for transparency regarding his father’s historical involvement with Tether while leading the firm.
The inquiry brings to light a curious geographic and operational disconnect within the stablecoin giant’s business model. While Tether maintains an official corporate footprint abroad, claiming to operate primarily out of El Salvador, the reality of its balance sheet tells a vastly different story. The vast majority of the company’s multi-billion-dollar backing assets reside securely within the United States, placed directly under the custodianship of Cantor Fitzgerald.
"While Tether claims to operate out of El Salvador, the vast majority of its assets reside in the United States under your custodianship," the Connecticut lawmaker wrote, emphasizing the domestic implications of the arrangement. "As Congress considers how to best regulate digital assets, your partnership with Tether will provide important insights into the inner workings of this industry."
Among the numerous detailed inquiries outlined in Blumenthal’s letter, the senator specifically demanded to know what proactive measures the Wall Street institution has implemented. One of the primary requests reads: "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."
Despite the gravity of the inquiries and the official nature of the Senate correspondence, neither Cantor Fitzgerald nor Tether immediately responded to official requests for comment submitted to their respective corporate spokespeople. The silence from both institutions leaves key questions unanswered regarding how the U.S. custodian vets the massive inflows and offshore operations associated with the world’s largest stablecoin issuer.
For months, Senator Blumenthal, alongside other prominent and aggressive congressional critics of the cryptocurrency industry—such as Senator Elizabeth Warren—has found their investigative efforts constrained by the inherent limitations of being members of the minority party. Operating without control of the congressional agenda or committee gavels means minority lawmakers often rely on voluntary cooperation, public pressure, and letters that lack the immediate weight of enforceable legal mandates.
However, that dynamic could undergo a dramatic transformation if current political projections hold true. Securing a Democratic majority in the Senate for the upcoming congressional term would fundamentally alter the balance of power on Capitol Hill. Should Democrats manage to win several more crucial seats in the upper chamber, lawmakers like Blumenthal would find themselves positioned directly at the helm of powerful committees equipped with full subpoena power. Such authority would grant them the legal capability to compel document production, financial disclosures, and high-profile testimony from reluctant corporate executives.
As it currently stands, major prediction markets suggest that Democrats enjoy a robust and growing probability of returning to the majority in the Senate. According to data from Kalshi, the odds of a Democratic Senate takeover currently sit at 61%, while Polymarket places the likelihood slightly higher at 64%. These figures represent a notable shift from just several weeks prior, when political prognosticators viewed the battle for the upper chamber as a dead-even 50-50 toss-up.
Meanwhile, the political landscape in the U.S. House of Representatives appears even more favorable for the Democratic Party. Both major prediction platforms indicate that the probability of a majority shift in the lower chamber has surged past 90%, pointing toward a potential broad legislative realignment in Washington. If these electoral forecasts translate into reality, congressional oversight into the cryptocurrency sector—and specifically the deep financial pipelines connecting foreign-backed digital assets to Wall Street custodians—is poised to enter a much more aggressive and legally enforceable phase.
