Tether (CRYPTO: USDT) on Monday announced it has acquired a Digital Asset Service Provider (DASP) license by El Salvador, allowing it to subsequently relocate its operations to the Central American nation.

What Happened: In a press release, the company stated El Salvador’s crypto-friendly policies, favorable regulations and adoption of digital assets by its citizens prompted the decision to relocate.

“This strategic positioning is helping to shape the future of financial systems, making the country a key player in the global fintech landscape,” Tether stated.

The company further stated that its move to El Salvador positions it to scale its efforts in supporting financial inclusion leveraging Bitcoin and stablecoin adoption in underserved regions.

It added that the move enhances Tether's flexibility to explore “groundbreaking” solutions in a supportive regulatory and business environment.

Also Read: MicroStrategy Acquires 2,530 Bitcoin For $243M, Reaching 450,000 BTC In Total Holdings

Why It Matters: Tether is under scrutiny by U.S. federal authorities for potential sanctions and alleged anti-money laundering violations.

In November 2024, unsealed court filings revealed that Mexican and Colombian drug cartels have used Tether and Bitcoin (CRYPTO: BTC) for laundering millions of dollars.

The documents detail how groups like the Sinaloa cartel exploit stablecoins to move wealth across borders through peer-to-peer networks, over-the-counter trades, and currency exchanges.

A source disclosed to investigators that cartels often buy USDT in Mexico below market rates—given its connection to illicit funds—and later sell it in Colombia.

These activities are complemented by blockchain transactions that obscure the origins of funds, including conversions to Ethereum (CRYPTO: ETH).

Investigations have also uncovered substantial cryptocurrency activity linked to these cartels.

For example, a Binance account under investigation processed $15 million in suspicious transactions between 2020 and 2023.

Tether itself has reported working with global law enforcement agencies on over 195 cases involving illicit activities, blocking more than $2 billion in USDT tied to criminal operations.

The company's CEO Paolo Ardoino did not respond to a request for comment

Read Next:

Donald Trump Jr. Joins Kalshi Prediction Market As Strategic Advisor

Image: Shutterstock