Tether Takes Bold Steps: $5.2M in USDT Frozen Due to Phishing Links
Tether, the popular stablecoin issuer, continues to crack down on illicit activities within the cryptocurrency industry. In a recent move, Tether identified and froze $5.2 million worth of USDT to strengthen its network controls and combat money laundering.
The frozen funds were initially brought to Tether’s attention by MisTrack, a blockchain tracking platform. They discovered that the USDT had been spread across 12 Ethereum wallets, which were labeled as “USDT Banned Addresses.” These funds were suspected to have been obtained through various phishing schemes.
Tether’s actions in freezing these illicit funds demonstrate its commitment to maintaining the integrity and security of its network. This is not the first time Tether has taken proactive measures to combat illegal activities. In March 2024, the company partnered with the US Department of Justice (DoJ) and the Federal Bureau of Investigation (FBI) to seize $1.4 million worth of USDT from a tech support scam network.
Tether also actively monitors USDT addresses and has taken significant steps to blacklist suspicious ones. In January 2022, the company blacklisted three Ethereum addresses holding over $150 million in USDT. In October 2022, they froze $8.2 million in USDT on the Ethereum blockchain and added 215 Ethereum-based USDT addresses to the blacklist.
The company has demonstrated its swift response to emerging threats in the past. In late 2022, Tether froze over $360 million in assets linked to illicit activities and took action against USDT associated with terrorist activity in Ukraine and Israel, freezing $817,000 in October 2023. Additionally, in November 2023, they froze $225 million in USDT connected to romance scams.
To enhance its monitoring capabilities, Tether has partnered with Chainalysis to develop tools for identifying wallets that may pose risks or be associated with illicit or sanctioned addresses.
The recent freezing of USDT by Tether comes at a time when there is potential scrutiny from the US government. A UN report identified USDT as the preferred cryptocurrency for money laundering, leading to speculation about a possible US government investigation. Ripple CEO Brad Garlinghouse fueled these speculations by suggesting that the US government is indeed targeting Tether, the largest stablecoin issuer globally.
However, Tether CEO Paolo Ardoino responded strongly to Garlinghouse’s remarks, criticizing him as an “uninformed CEO.” Ardoino pointed out that Ripple itself is currently under investigation by the SEC and insinuated that Garlinghouse’s comments were driven by Ripple’s upcoming stablecoin, which could compete with USDT. He also emphasized Tether’s collaboration with law enforcement agencies worldwide to combat illegal activities.
These partnerships have played a crucial role in identifying and mitigating risks associated with illicit activities involving USDT. Tether has worked with 24 agencies across more than 40 countries, responding to 198 requests to block wallets in the past year and 339 requests in the last three years.
In conclusion, Tether’s latest actions demonstrate its determination to tackle illicit activities within the cryptocurrency industry. Through partnerships, freezing of funds, and active monitoring, Tether aims to preserve the trust and security of its network.
