A Change in Terms of Service
Stablecoin issuer Tether has reportedly made changes to its terms of service (ToS) in Singapore, prohibiting certain customer groups from redeeming Tether (USDT). An email shared by the co-founder and CEO of decentralized finance protocol Cake DeFi, Julian Hosp, revealed the company's new ToS, which states that Tether cannot be redeemed for US dollars due to the changes. Hosp also mentioned that as a Singapore-based entity, he is unsure whether Cake DeFi can redeem USDT into US dollars.
Restricted Onboarding Standards
The updated ToS for Tether includes restrictions on its onboarding standards. According to the changes, entities controlled by another corporation, directors, and shareholders residing in Singapore are no longer allowed to be Tether customers. This new requirement has caused confusion within the crypto community, with Cake DeFi being informed that it is considered "controlled by another corporation" and therefore cannot issue or redeem Tether through the platform.
Connection to Recent Money Laundering Scandal
Users on X (formerly Twitter) pointed out that Tether's change in ToS coincides with a significant crypto money laundering scandal in Singapore, where seized assets have surpassed $2 billion. The timing of these new redemption terms has raised concerns about the impact on the crypto industry in Singapore, which has recently attracted numerous crypto firms due to its favorable regulations. With the crackdown on crypto in Hong Kong, this development may further limit the access to Asia for the crypto sector.
Possible Partnership Issue with Cake DeFi
Speculation arose that the changes in USDT redemption terms may be specific to Cake DeFi. One user suggested that the DeFi protocol is flagged for enhanced due diligence (EDD), implying a partnership issue between the two firms. However, further details or confirmation of this speculation have not been provided.
Cointelegraph reached out to Tether for comment on the email shared by the Cake CEO and the changes in its ToS but has not received a response at the time of publication.
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