December 8, 2023

Tether reportedly shuts USDT redemption for some Singapore customers

Stablecoin issuer Tether has reportedly changed its terms of service (ToS) in Singapore. An email shared by the CEO of decentralized finance protocol Cake DeFi on Sept. 25 shows changes to the company’s ToS prohibiting certain customer bases from redeeming Tether (USDT).

Cake co-founder and CEO Julian Hosp shared the email received from Tether, in which the company stated it cannot redeem USDT for United States dollars due to changes in its ToS.

In a post on X (formerly Twitter), Hosp stated that he is unsure whether Cake could redeem USDT into U.S. dollars due to being based in Singapore. In a statement shared with Cointelegraph, Tether spokesperson stated:

“Tether has a meticulous onboarding process which is in full compliance with global regulations, including the guidelines set forth by Singapore regulators. This commitment to compliance is unwavering and remains a cornerstone of our platform.”

Moreover, Tether told Cointelegraph that their Terms and Conditions (TOC) related to Singapore entities have remained unchanged since May 2020.”

The key changes to the ToS of Tether include restricting its onboarding standards and “corporates controlled by another entity, directors, and shareholders residing in Singapore are no longer permitted to be Tether customers.“

The term “controlled by another entity” confused many in the crypto community, including Cake DeFi, which was informed that it is “controlled by another corporation in Singapore. Accordingly, you will not be permitted to be issued or redeemed from the platform.“

Tether CTO Paolo Ardoino refuted speculation around the mail calling it a FUD. Ardoino claimed the policy change in question has been applicable since 2020, however, Tether didn’t answer to queries on why Cake DeFi was notified earlier in Sept. 25 about the same.

Related: Singapore’s central bank slugs Three Arrows founders with 9-year ban

X users highlighted Tether’s recent change in ToS comes amid a major crypto money laundering scandal in Singapore where assets seized from the bust have swelled to over $2 billion.

Another user speculated that the changes in the USDT redemption terms could be a Cake DeFi-specific problem, suggesting that the DeFi protocol is flagged as enhanced due diligence (EDD), and thus, it could be a partnership issue between the two firms.

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