An Unreported Loan Reveals the Financial Ties Between the U.S. Commerce Secretary and Tether
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An Unreported Loan Reveals the Financial Ties Between the U.S. Commerce Secretary and Tether
The Lutnick family owes Tether another favor.
Navigating Web3 tides with focused insightsBy David Kocieniewski, Anthony Cormier, and Todd Gillespie, Bloomberg
Translated by Chopper, Foresight News
Last October, U.S. Commerce Secretary Howard Lutnick sold his multibillion-dollar equity stake in Cantor Fitzgerald to a trust established for the benefit of his four children. He has led the financial services firm for more than three decades, and the arrangement was designed to comply with federal ethics rules.
Almost simultaneously, one of those trusts took an unusual step. “Dynasty Trust A,” which benefits all four children, borrowed an undisclosed sum from stablecoin issuer Tether. A 2024 investment by Tether helped propel Cantor Fitzgerald’s assets to new highs, while its offshore parent company has been actively advocating for more favorable regulatory policies for U.S. cryptocurrency.
Spokespersons for Cantor Fitzgerald and Lutnick’s children declined to discuss the loan amount or confirm whether the funds were used to finance any part of the asset sale. However, spokesperson Stan Neve said the acquisition “was financed through multiple funding sources, multiple companies, and multiple trusts at market rates and market prices,” consistent with the federal ethics agreement signed by Howard Lutnick. This loan had never before been reported in the media.
In February 2026, Tether’s logo appeared on cushions at Bithumb Exchange in Seoul
A credit filing submitted in New York State on October 7 shows the loan was secured by “all assets” held by the trust—including any assets it might acquire later. A Cantor executive familiar with the transaction said the loan was specifically backed by a convertible bond granting Cantor the right to acquire 5% equity in Tether.
According to a recent filing by the financial services firm, Dynasty Trust A holds more than half of Cantor Fitzgerald’s equity. But Neve stated that control of the company “rests entirely with the next generation of the Lutnick family through a separate, independently managed entity—and has never been pledged.”
By selling his assets, Lutnick satisfied federal regulations intended to eliminate potential conflicts of interest for presidential appointees. Yet experts who reviewed the transaction documents say that if this loan assisted Lutnick in selling his equity to his children’s trust, it would undermine the very purpose of federal divestiture requirements.
“Theoretically, this transaction was meant to eliminate conflicts of interest—but in practice, it created new ones,” said Kathleen Clark, a law professor at Washington University in St. Louis and former ethics counsel for the District of Columbia. She explained that if Tether’s loan helped Lutnick complete a deal that “ultimately benefits both himself and his children,” then his family owes Tether a further debt of gratitude. That raises concerns that Howard Lutnick may use his governmental authority to benefit Tether—and his own children—rather than the public interest.
A Cantor Fitzgerald executive familiar with the matter disputed Clark’s view, saying the loan does not alter the “already robust economic and strategic alliance” between Tether and the firm. Tether’s spokesperson did not respond to requests for comment.
The U.S. Department of Commerce spokesperson did not respond to a series of questions but issued a statement: “Secretary Lutnick has fully complied with the terms of his ethics agreement, including all divestiture and recusal requirements—and will continue to do so.”
The loan amount extended by Tether to the trust remains unclear, as does the price paid by Lutnick’s children to acquire their father’s equity. As CEO and chairman, Lutnick holds the vast majority of the firm’s shares. Following Cantor’s 2024 investment in Tether, the firm’s valuation surged by billions of dollars on paper.
Tether’s core business is issuing USDT, a dollar-pegged stablecoin that enables instant, low-cost transactions outside the traditional banking system. For every USDT issued, Tether is supposed to hold high-quality, highly liquid reserve assets. Last year, Tether disclosed $192 billion in reserves; since 2021, Cantor has earned fees managing those reserves. Tether’s profitability is exceptionally high—reportedly $10 billion in profit last year, with a 99% margin.
The stablecoin company’s success has been accompanied by controversy. In 2021, U.S. regulators accused Tether and its affiliates of making misleading statements about losses and reserves, resulting in a roughly $60 million fine—though neither company admitted wrongdoing. According to two informed sources, Tether was also under investigation by the U.S. Department of Justice in 2024, though the current status of that probe remains unclear.
Meanwhile, the Donald Trump administration relaxed enforcement against cryptocurrency, dissolving investigative teams focused on crypto-related crimes within the Department of Justice and the U.S. Securities and Exchange Commission. A 2024 United Nations report identified Tether as the “preferred tool” of Southeast Asian gangs and money launderers. Tether responded by stating it collaborates with law enforcement agencies worldwide and subjects its tokens to comprehensive, high-standard monitoring.
Before partnering with Cantor in 2021, most U.S. banks avoided doing business with Tether. Lutnick said he personally negotiated the partnership and audited Tether’s books to verify it held the assets it claimed. At his Senate confirmation hearing, he stated that Tether executives assured him they would cooperate with law enforcement and implement measures to combat money laundering.
In April 2024, Lutnick participated in Cantor Fitzgerald’s investment negotiations with Tether. Bloomberg previously reported that the investment took the form of a $600 million convertible bond granting the financial services firm 5% equity. The paper value of that stake has risen sharply; if Tether achieves its rumored $500 billion valuation in recent talks with potential investors, the stake could be worth $25 billion—exceeding the combined value of all Cantor’s other assets.
After Trump’s re-election in November 2024, Lutnick helped lead the transition team, while Cantor continued collaborating with Tether on various deals. In December 2024, Cantor arranged a $775 million investment by Tether into Rumble Inc., a loss-making video-sharing platform. In April 2025, Tether and Cantor jointly announced—with SoftBank Group—the formation of Twenty One Capital Inc., a Bitcoin treasury management company.
Twenty One Capital listed on the New York Stock Exchange in December 2025
In July 2025, Trump signed the GENIUS Act—a landmark piece of legislation for the stablecoin industry. The bill includes several provisions favorable to Tether, such as a three-year grace period before the El Salvador–based company must comply with U.S. regulatory requirements.
White House spokesperson Kush Desai, responding to questions about Lutnick’s divestiture and the Tether loan, said: “The only special interest guiding the Trump administration’s decisions is the greatest interest of the American people. Secretary Lutnick has consistently placed America and Americans first—by securing historic trade and investment agreements, fostering a level playing field, and creating jobs for American workers.”
In February 2025, Lutnick handed over the roles of chairman and CEO of Cantor Fitzgerald to his 28-year-old son, Brandon. Brandon had previously collaborated with Tether in Lugano, Switzerland, and recently described developing a “growing friendship” with Tether CEO Paolo Ardoino.
As a Wall Street billionaire, Lutnick faced a complex task in divesting his assets. His financial disclosure forms list more than 800 holdings—from stocks and apartment complexes to a satellite company. An official involved in the filing process—who requested anonymity—said Lutnick’s ownership stakes across numerous subsidiaries and joint ventures were so extensive that even lawyers reviewing his divestiture agreement worried they couldn’t trace the full scope of his financial interests.
In January 2025, Lutnick attempted to assuage these concerns by submitting an ethics agreement pledging to divest his equity stakes and resign from management positions at affiliated enterprises. Because some transactions require regulatory approval—and thus take time—he stated he would not “personally and substantially participate in any particular matter that could affect any enterprise from which he has divested,” unless granted an ethics waiver.
In July 2025, President Donald Trump displayed a copy of the GENIUS Act in Washington, D.C.
Early in the administration, Lutnick joined the Crypto Policy Steering Group, then agreed in May to “lock in” the value of his assets—relinquishing future appreciation gains. On July 8, he received a limited ethics waiver permitting him to engage in “high-level strategic and executive discussions” on matters that might have only a “de minimis effect” on enterprises he had divested from—but barring him from participating in matters directly affecting those enterprises. He completed the Cantor divestiture in October.
Lutnick is one of a dozen members of the President’s Digital Asset Markets Working Group, which held over 1,000 meetings with industry officials last winter and spring. On July 30, the group released a 160-page report outlining the administration’s plans. Three of Lutnick’s colleagues from the Department of Commerce contributed to drafting the document.
The group’s recommendations include “advancing the development and growth of stablecoins”—a market in which Tether commands roughly two-thirds of the share. The report states: “Policymakers should encourage stablecoin adoption to reinforce the dollar’s dominance in the digital age.” The group praised the GENIUS Act, which Cantor Fitzgerald and Tether both lobbied heavily for.
Before his confirmation hearing, Lutnick was asked about his relationship with Tether and replied that he would “faithfully discharge my duties in accordance with applicable government ethics laws and regulations.”
On May 19, Cantor Fitzgerald and its affiliates announced an agreement to sell the majority of their businesses to Lutnick’s children, calling it a milestone toward “succession to the next generation.”
The asset sale closed on October 6. Lutnick’s equity in Cantor’s publicly traded affiliates—commercial real estate firm Newmark Group Inc. and brokerage BCG Group Inc.—was repurchased by Cantor and those two firms for over $350 million.
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