Source from Swiss press by Enrico Kampmann. This is a translation in English.

The man behind the counter quickly found the right payment terminal, but was clearly having trouble with it. Frowning, he hastily pressed a few buttons on the device, then called an older colleague for help so he could return to the growing line. The stand in front of the delicatessen in Lugano's old town was busy. It was midday, the sun sparkled on the turquoise lake and warmed the cobbled streets. The warm spring air made you want to sit in the piazza and drink Aperol Spritz on repeat. A completely inappropriate moment to pay for your porchetta sandwich with Bitcoin.

The second colleague soon has to call for backup, and a young woman emerges from the depths of the store and quickly makes a decision: The machine will be replaced. Shortly thereafter, the phone scans the QR code on the new terminal, but nothing happens. A deep breath, another attempt – and lo and behold, it works.

9.50 francs (0.00011269 Bitcoin) for the sandwich plus 1.40 francs in fees and a good five minutes of waiting time. Somehow, that doesn't feel like the future of the financial world. B stands for Bitcoin

In March 2022, the Lugano government announced its ambitious "Plan B" with great fanfare, a project intended to make Lugano the "Crypto Capital of Europe." The B stands for Bitcoin. Its main partner is Tether, issuer of the world's most traded cryptocurrency USDT and operator of the crypto exchange Bitfinex. The deal is outlined in the jointly signed "Memorandum of Understanding": Tether will provide the resources to establish a thriving crypto ecosystem in Lugano—including a CHF 100 million fund for blockchain startups and a complementary CHF 3 million fund to support local businesses in adopting crypto payments. Residents can already pay taxes, fees, and purchases with Bitcoin, USDT, or the city's own token, LVGA (pronounced "Luga"). Over 450 local businesses accept the digital currencies. In return, as the memorandum states, Tether will use the “stylish and prosperous city with a Mediterranean climate” as a “test laboratory” for new technologies and software before they are introduced worldwide.

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One hand washes the other, so to speak. But there's a catch: Tether has a history that has led to lawsuits elsewhere rather than partnerships.

Since 2016, Tether has been regularly targeted by US authorities – including for concealing losses (settlement of $18.5 million), false statements regarding dollar coverage (fine of $41 million), and suspicion of market manipulation (unsubstantiated).

As a "stablecoin," Tether is pegged to the US dollar. Due to this stability, the currency has long since become a preferred vehicle for money laundering. Numerous reports document its role in facilitating human trafficking and forced labor in Southeast Asia, in the networks of drug cartels and terrorist organizations, and in evading sanctions imposed by the Russian and North Korean regimes.

Tether's mysterious creator, the now sixty-year-old Italian Giancarlo Devasini, has already attracted attention in the past with his "creative" business models. Once a cosmetic surgeon, Devasini switched to the IT industry in the early 1990s. In 1996, he was forced to pay Microsoft compensation for selling pirated copies of its software worth millions. After several failed ventures, he founded Tether in 2014. Despite recurring legal troubles, business is booming: Forbes estimates Devasini's fortune at $22.4 billion—more than double what it was a year ago.

From 2017 to June 2023, Devasini lived in Lugano, where he expanded his empire from an inconspicuous office above a sports bar. The modest three-room apartment in a prefabricated building with red metal windows and a weathered facade hardly looks like the former residence of a crypto billionaire. According to the "Corriere del Ticino," the monthly rent is around 1,400 Swiss francs. Today, his name is neither on the doorbell nor in the Ticino commercial register.

Devasini, always media-shy, has largely withdrawn from public life. Since December 2023, CEO Paolo Ardoino, a charismatic 40-year-old Italian residing in Lugano, has been the face of the company. However, a document from the U.S. Securities and Exchange Commission (SEC) database from the end of March shows that Devasini still holds more than 50 percent of Tether's voting rights and is the sole signatory—a clear sign that he still holds the reins firmly. «Simply naive»

The mayor of Lugano, Michele Foletti, likes to say that he used to have lunch with Devasini often. Today, the Lega politician welcomes Devasini to a high-ceilinged meeting room in the venerable town hall, sitting at an oversized table made of dark solid wood. Sitting beside him is Pietro Poretti, Director of Economic Development. He is "very satisfied" with the progress of "Plan B," says Foletti, and goes on to list the achievements of the past three years: international visibility, a wave of new companies in the crypto and blockchain sector. "Over eighty since the beginning," adds Poretti. He only updated the list this morning – but it is not open to public inspection.

And what is Foletti’s position on the criminal past of his business partners?

"Perhaps they were simply naive back then." The legal problems were primarily due to a lack of regulation in the early days of digital assets, Foletti said. "Without clear rules, it was difficult to know what was allowed and what wasn't."

Foletti emphasizes that the city bears no financial risk. The investments in "Plan B" came exclusively from Tether and its partner companies. Should the company's business practices prove to be illegal and lead to its collapse – as happened in November 2022 with FTX, the world's second-largest crypto exchange at the time – only Lugano's reputation would be damaged, not the city's coffers.

However, Lugano GLP cantonal councilor Sara Beretta Piccoli sees another risk in the close partnership with Tether: that the city is tying itself to an economic sector fueled by money laundering – again.

As numerous court cases demonstrate, for decades Lugano was a preferred "laundromat" for Italian mafia clans and other wealthy clients who valued "discretion." The abolition of banking secrecy hit what was once Switzerland's third-largest financial center hard: With increasing international pressure for tax transparency and the automatic exchange of information, client funds flowed out, fines rained down, banks closed their doors in droves, and numerous jobs were lost.

As Switzerland's lowest-income region, Ticino has also been disproportionately hit hard by the pandemic. The "Plan B" is intended to attract new companies to the city, bringing more money back into the city and helping to achieve economic turnaround. But Beretta Piccoli is skeptical: "More than 2,000 families in Lugano rely on a "Tablecloth Set Yourself" subscription to make ends meet, but the government's priority is to ensure that people can pay for their coffee with Bitcoin. That's absurd!" And the proliferation of such payment methods opens the door to money laundering in the region. The investigations that became public last week against a Ukrainian man in Giubiasco, who is alleged to have laundered hundreds of thousands of Swiss francs through cryptocurrencies, confirm Beretta Piccoli's fears. "The transactions are anonymous," she says, "there is no oversight whatsoever." Only a private office

According to the Swiss Financial Market Supervisory Authority (FINMA), Tether, as a stablecoin issuer, is considered a "financial intermediary within the meaning of anti-money laundering legislation" and would be required to identify its users. However, since the company does not have an official branch in Switzerland, the supervisory authority is not responsible.

Unofficially, however, Tether is very much present. In November, the "POW Space," a co-working hub for Bitcoin startups, opened in a newly renovated old town building with an elegant atrium, funded by the "Plan B" foundation. During a tour, Giacomo Zucco, Vice President of the "Plan B" Foundation, explains that the top floor is used by Tether. CEO Paolo Ardoino presumably runs the billion-dollar company from here. Mayor Foletti dismisses the claim: It's Ardoino's "private office" with no connection to Tether. That doesn't sound very plausible.

There are further connections between Tether and Lugano: Claudia Lagorio, a member of the executive board of Tether and Bitfinex, lived in the city until recently and sits on the board of directors of the market and opinion research firm UBQ, which is also based in the POW space. Alessia Origgi, a young Ticino native who also lives in Lugano, sits on the same board of directors. A whole network of companies is centered around her – always with traces back to Tether or Giancarlo Devasini. Neither she nor Lagorio responded to inquiries.

Tether was formerly registered in the British Virgin Islands; today, its official headquarters are in El Salvador, a crypto haven without any regulation under autocratic President Nayib Bukele. Suspicions arise that Tether is deliberately attempting to circumvent the stricter Swiss regulations. When asked about this, FINMA stated that it "generally does not comment on its supervisory activities or the licensing requirements of individual companies."

The fact is: With a market capitalization of $144 billion, Tether is comparable to a medium-sized bank, yet it is accountable to no one. This affects not only issues of money laundering, but also the transparency of the company's reserves. "If Tether were a bank, the company would have to submit a full audit," says Giovanni Barone-Adesi, economics professor at the Università della Svizzera italiana. Tether, on the other hand, has never had a real audit conducted. Instead, the company regularly publishes so-called "Independent Auditors' Reports" – "but these don't provide a complete picture."

Furthermore, these reports are prepared by the auditing firm BDO Italia, which was recently fined €250,000 for tampering with the financial statements of a bankrupt crypto exchange. In short: No one outside the company knows for sure whether Tether actually has the liquid assets it claims to have. When asked about this and other points, management remained silent until press time. No member was willing to speak.

None of this seems to worry Michele Foletti. The mayor is confident in his plan. So confident, in fact, that he wants to expand his collaboration with Tether. "We're currently talking with Paolo and Giancarlo about broadening our horizons," he says. Tether made thirteen billion dollars in profit last year, money that will now flow into new business areas: artificial intelligence, robotics, medtech, neuroscience. "Tether is expanding and wants to continue doing so with us, in close cooperation with local universities." The promotion of education and startups should remain at the center of this.

As with the original "Plan B," this all sounds extremely promising – if it weren't for this catch. One can only hope that Lugano has a solid Plan C in store for emergencies. If not, at least there's the Aperol Spritz on the sunny piazza.

Let's add something more: An SEC filing by Bitdeer just confirmed that Tether is a one man operation. Last summer in an SEC filing Tether disclosed its Board of Directors was just 2 insiders: Van der Velde and Devasini

Today, in a new filing from Bitdeer (post Tether’s shift to El Salvador) it was disclosed that Devasini controls more than 50% of Tether holdings.

Don Giancarlo is the Tether Capo. Paolo is just the front man