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Tether Freezes $225M USDT Linked to DoJ Trafficking Probe


Tether, the stablecoin issuer, has frozen $225 million in its USDT cryptocurrency as part of a U.S. Department of Justice (DoJ) investigation targeting an international human trafficking ring in Southeast Asia.

When Tether freezes a wallet, it restricts the ability to transfer funds ("send USDT") from that wallet until the freeze is lifted.

Pig Butchering Scam

The funds were also connected to a "pig butchering" scam that cost U.S. citizens $3.3 billion in 2022, as per the FBI.

The "pig butchering" scam involved scammers using a romantic scheme to set up fake crypto exchanges, ultimately stealing billions from unsuspecting American users.

Similar schemes are used in Southeast Asia.

One example in Singapore saw a woman losing $240,000 in such a scam after fraudster had courted her for months.

Blacklisted Addresses

Blockchain analytics provider Peckshield identified at least six blacklisted wallet addresses, one holding up to $87 million in Tether's stablecoin.

#PeckShieldAlert$USDT Added BlackList: 0xc7c8f8284c5360d0086a2f0a05bdd07afde23246
Balance: $29.41M pic.twitter.com/MO0gr0Vgbh
— PeckShieldAlert (@PeckShieldAlert) November 20, 2023

Tether, in collaboration with the DoJ and crypto exchange OKX, utilised on-chain tracking tools from Chainlysis in the joint investigation.

This development follows recent pressure from U.S. policymakers urging the DoJ to consider prosecuting Tether and Binance for alleged involvement in money laundering and other criminal acts.

Tether had since undergone a leadership change, appointing former CTO Paolo Ardoino as CEO.

Coinlive previously reported on how Tether froze 32 addresses linked to illicit finance in Israel and Ukraine amid geopolitical conflicts.

Tether has, as of time of publishing, destroyed close to $187 million USD of such blacklisted funds.

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