Tron, Tether, and blockchain intelligence firm TRM Labs have formed a strategic alliance called the T3 Financial Crime Unit (T3 FCU), aimed at curbing illicit activities tied to USDT on the Tron blockchain, the company announced.
This collaboration was launched in July to strengthen security and reduce crime in the rapidly expanding cryptocurrency space. Tron, the decentralized blockchain organization, Tether, the issuer of the USDT stablecoin, and TRM Labs are leveraging data, technology, and partnerships with law enforcement to disrupt illegal activities.
A T3 Financial Crime Unit to Combat Illicit Activity on Tron Blockchain
The objective, according to Tron founder Justin Sun, is to raise the bar for industry standards and make the cryptocurrency community safer and more secure.
With a market capitalisation of over $118 billion, stablecoins such as USDT serve as the foundation of the cryptocurrency markets by supplying liquidity for trades and transactions, Forbes reported.Â
However, due to so much of its supply, more than half is flowing on the Tron blockchain, USDT has become a target for bad actors like terrorists, money launderers, and terrorists.
Through the identification and reporting of questionable activity on the blockchain, the T3 FCU project seeks to resolve this problem. Since 2019, Tron and TRM Labs, a renowned blockchain intelligence company, have worked together to map illegal activity.
According to Esteban Castaño, CEO of TRM Labs, this project builds on the current collaboration by strengthening investigative and intelligence capacities to combat illegal activity.
A Worrying Rise in Illicit Activity
In 2023, USDT contributed to the greatest number of unlawful transactions among stablecoins, totalling $19.3 billion or 1.63% of their whole volume, according to TRM Labs’ unlawful Crypto Economy study, which was released in April. In contrast, the unlawful volume of USDC, a significant stablecoin, was only $428.9 million.
Tron accounted for 45% of all illicit cryptocurrency transactions in 2018, which is a higher percentage than on other blockchains like Ethereum (24%) and Bitcoin (18%).
The T3 Financial Crime Unit has already made great strides in response to these mounting worries, blocking more than $12 million in USDT connected to schemes in several nations.Â
Global Collaboration to Tackle Financial Crimes
The success of the T3 FCU relies heavily on global cooperation. TRM’s head of global investigations, Chris Janczewski, emphasized that the unit’s initial successes involved agencies from the U.K., U.S., and Australia. He highlighted the importance of international collaboration to effectively tackle the global nature of blockchain-related crimes.
Tether CEO Paolo Ardoino praised the system’s ability to quickly respond to crime, noting that freezing assets on a blockchain can take just minutes, a sharp contrast to the lengthy delays often seen in traditional financial systems.
This initiative also coincides with Pavel Durov, the founder of Telegram, being arrested recently on suspicion of enabling illicit transactions on his network. Both Ardoino and Sun have openly backed Durov while reiterating their dedication to openness and compliance.
Castaño of TRM thinks that the T3 FCU’s initiatives will increase the potential for risk reduction in the cryptocurrency industry. Although less than 1% of all transactions are criminal, he sees a chance to further lower this percentage and make the environment safer for users who are acting legally.