Senator launches investigation into Tether following allegations of contract with former Trump administration crypto official
Congressional investigators have issued demands for documentation regarding the relationship between Tether and Nxum, a firm co-established by Bo Hines, who previously served as a cryptocurrency adviser in the White House.
Following revelations in a Wall Street Journal investigation that the stablecoin issuer entered into a $6.3 million agreement with a marketing firm co-established by former White House cryptocurrency adviser Bo Hines, Senator Richard Blumenthal has sought documentation from Tether's chief executive Paolo Ardoino.
The Connecticut senator delivered a Thursday correspondence to Ardoino in which the Senate Permanent Subcommittee on Investigations issued demands for "records and information related to contracts, payments, communications, and lobbying" involving Tether and Hines' company, Nxum. Blumental characterized the investigation into Nxum, Tether and Hines as a component of what he described as the Trump administration's pattern of "self-enrichment and self-dealings with cryptocurrency firms."
"While Hines failed to divest his one-third stake in Nxum [...] he worked closely over encrypted messaging applications with Nxum to coordinate lobbying, advocacy, and browbeating of members of Congress that were opposed to, or had sought changes to, pending stablecoin legislation," said Blumenthal. "Those messages also reportedly demonstrate that Tether was directly coordinating Nxum's lobbying efforts on the GENIUS Act which would regulate stablecoins, with CEO Paolo Ardoino demanding that Nxum 'obliterate' the legislation's opponents."
The senator further stated:
"The highly unusual terms and nature of Tether's business relationship with both Nxum and Bo Hines raise alarming ethical and legal concerns, indicating that Tether was likely well aware of the illegality and impropriety of issuing payments to a current White House official with such a direct role in shaping cryptocurrency legislation that was instrumental to its business."
During the period from January to August 2025, Hines served in the role of executive director of the President's Council of Advisers on Digital Assets before departing the White House to assume a position with Tether as a "strategic adviser." His career trajectory subsequently led to his appointment as CEO of Tether US. In a parallel move, Harry Jung, who also served as a crypto adviser within the Trump administration, departed his governmental role in July 2026 and assumed the position of managing director at Nxum the following month in August.
The president, members of his family, and various officials within his administration remain under continued examination regarding allegations that they are benefiting financially from cryptocurrency policies and legislation over which they exercise control or maintain influence. Trump's financial disclosures revealed earnings of $1.4 billion from crypto-related investments during 2025.
An inquiry was sent by Cointelegraph to Tether requesting commentary regarding the investigation and the published report, however no immediate reply was forthcoming.
Crypto ties could be a factor in midterm elections
Although Blumenthal's powers are constrained in his capacity as the Democratic ranking member of the Senate Permanent Subcommittee on Investigations, the outcomes of the 2026 midterm elections have the potential to shift partisan control within both the House of Representatives and Senate. Such a political realignment could provide the Connecticut senator along with other Democratic lawmakers enhanced authority to pursue investigations examining Trump and his administration's connections to the cryptocurrency sector, particularly those relationships that may constitute conflicts of interest.
According to data available as of Friday, event contracts traded on prediction market platforms Kalshi and Polymarket indicated Democratic prospects for reclaiming majority control of both congressional chambers in 2027, showing 92% and 68% probability on Kalshi for the House and Senate, respectively. The US Election Day is scheduled for Nov. 3.