USDT can be frozen so its not the best choice. Its definitely a failure of the Tether team if criminals can openly use it to launder funds without it getting frozen, but they are famously anti regulation.

The usefulness in money laundering is a feature not a bug, and is why Tether is permitted to continue operating.

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From what I've heard about Tether (allegedly printing tethers backed by loans to insiders, or backed by very risky commercial paper, or even potentially billions of USDT backed by nothing), I think being useful for money laundering is the least of anyone's worries...