Show description: U.S. prosecutors allege Ryan Wedding led a multinational drug trafficking organization that moved more than $1 billion in narcotics proceeds and trafficked roughly 60 metric tons of cocaine per year into Los Angeles, and filings list more than 35 indictments in connection with the case. Authorities report seizures of over 4,000 pounds of narcotics, weapons, about $3.2 million in cryptocurrency tied to the operation, roughly $13 million in other assets, and the FBI added Wedding to its most wanted list with a $15 million reward. Investigators say the operation relied on stablecoins, particularly Tether, used chains of intermediary wallets and low-fee networks such as Tron for high-frequency transfers, and employed peeling, fanning, circular reconvergence, bridge usage, and token swaps to obscure funds. On-chain analysis linked activity across Bitcoin, Ethereum, Solana, Tron, and BNB Chain, and public tracing tied more than $3 million in crypto directly to the network with additional clusters under watch. OFAC designated multiple wallets connected to the alleged network, including several on Tron, and law enforcement executed seizures and freezes with cooperation from exchanges, custodians, and OTC desks while analytics firms published watchlists and flagged adjacent clusters. Officials, compliance experts, and analysts advised expanding sanctions screening to include clustered wallets, cross-chain mirrors, and bridge-derived addresses; tightening onboarding and KYC for high-volume stablecoin traders and OTC brokers with source-of-funds checks; enforcing Travel Rule data exchange where applicable between VASPs; implementing graph analytics to detect peeling, rapid reconvergence, and short-lived clusters; creating heuristics for USDT behavior on Tron to flag rapid hops and circular flows; and contracting analytics vendors to watchlist OFAC-linked clusters, score adjacency risk, and enable automated quarantine workflows pending human review. The filings and analysts project a hardened regulatory and enforcement environment with likely additional OFAC designations targeting stablecoin addresses and facilitator networks, faster freeze requests and designation cycles, increased metadata and reporting demands, and stronger cross-chain tracing requirements. Immediate technical priorities listed include instrumenting cross-chain tracing for Tron, Ethereum, Solana, Bitcoin, and BNB Chain; updating sanctions watchlists to include clustered and bridge-linked addresses; tightening onboarding for OTC and high-volume counterparties; and documenting rapid response playbooks for freeze and takedown events, and governance expectations include increased coordination among DOJ, OFAC, exchanges, analytics firms, and stablecoin issuers and planning internal playbooks to match faster external timelines. 

Source: https://theweb3.news/crypto/tether-allegations-ryan-wedding/

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