# Tether Defends Its Iran Record as Hong Kong and Singapore Compete for Regulated Stablecoin Business

The US Commodity Futures Trading Commission (CFTC), meanwhile, rejected CME Group's legal challenge over perpetual futures after approving the first bitcoin perpetual contract in the US.

- Published: 2026-10-20T05:08:28.334Z
- Canonical: https://polylog.news/2026-10-20/tether-defends-its-iran-record-as-hong-kong-and-singapore-co
- Publisher: Polylog (Global desk)
- Section: crypto
- Sources: [CoinDesk](https://www.coindesk.com/policy/2026/10/19/tether-senator-s-investigation-misses-positive-work-that-s-led-to-lower-iran-volumes), [South China Morning Post](https://www.scmp.com/week-asia/economics/article/3371445/singapore-hong-kong-take-different-paths-race-stablecoin-dominance-who-will-win?utm_source=rss_feed), [CoinDesk](https://www.coindesk.com/policy/2026/10/19/u-s-cftc-rebuffs-cme-legal-stance-in-consequential-fight-over-perpetual-futures)

Paolo Ardoino, chief executive of Tether, the largest issuer of dollar stablecoins, said a US senator's investigation overlooks work that has reduced the volume of Tether's tokens used in Iran, [CoinDesk reported](https://www.coindesk.com/policy/2026/10/19/tether-senator-s-investigation-misses-positive-work-that-s-led-to-lower-iran-volumes). The investigation alleges that Tether's stablecoins have supported financial activity in Iran. The dispute shows the dual role of private dollar tokens. They carry the dollar into economies outside the banking system, and their issuers now act as enforcement points for US sanctions policy.

In Asia, the two main financial centers are taking different approaches. Hong Kong is relying on its established banking network to bring stablecoins into mainstream finance, while Singapore is trying to make regulated digital currencies easier to use, [the South China Morning Post reported](https://www.scmp.com/week-asia/economics/article/3371445/singapore-hong-kong-take-different-paths-race-stablecoin-dominance-who-will-win?utm_source=rss_feed). Hong Kong's model keeps licensed banks in control of distribution. Singapore's model favors payments and adoption.

In Washington the dispute is over market structure. The CFTC argued that CME Group has not shown that the agency's new policy harms it, [CoinDesk reported](https://www.coindesk.com/policy/2026/10/19/u-s-cftc-rebuffs-cme-legal-stance-in-consequential-fight-over-perpetual-futures), after the regulator approved the first bitcoin perpetual futures contract, a leveraged derivative with no expiry date. The case will decide whether perpetuals, which until now traded mostly offshore, can move onto US-regulated venues.

## What this means

Dollar stablecoins contradict the desk's thesis that the dollar is slowly losing its reserve role. They spread demand for dollars and US Treasury bills into places that banks do not serve, and at the same time they give Washington a small number of issuers it can pressure on sanctions. Holders in sanctioned or high-risk jurisdictions bear the risk, because issuer compliance now determines whether their tokens can be frozen. Exchanges and banks competing for licenses in Hong Kong and Singapore face the same compliance demands. The market treats Tether's legal exposure as routine. What is new is a congressional investigation tied directly to Iran while a war with Iran is under way, which raises the political cost of any lapse. The precedent is the 2012 to 2014 enforcement campaign against European banks over Iran dealings, which ended with large fines and banks withdrawing from risky regions for years. The desk's read is that over the coming months stablecoin issuers will tighten freezing and screening of Iran-linked addresses, and that some volume will move to non-dollar tokens or wallets not controlled by a custodian (unhosted wallets). If the senator's investigation produces legislation, the move away from dollar stablecoins would come faster.

## What to watch

- New Tether freezes of addresses linked to Iran. A visible increase would show that the issuer is behaving as a sanctions-compliance gatekeeper.
- Trading volumes in non-dollar stablecoins in Asia. Growth would show that sanctions risk is pushing users out of the dollar-token system.
- The court's ruling on CME Group's challenge to the CFTC. A CFTC win would bring offshore leveraged crypto trading onto US-regulated venues.