Stablecoin issuer Tether has reportedly frozen roughly $4.2 billion price of its USDt tokens linked to suspected legal exercise over the previous three years.
Many of the blocked funds have been restricted since 2023, as regulators and regulation enforcement businesses intensified scrutiny of crypto-related fraud and sanctions evasion, the El Salvador-based agency reportedly told Reuters on Friday.
Tether’s dollar-pegged USDt (USDT) token is the biggest stablecoin in circulation, with greater than $180 billion excellent, up sharply from about $70 billion three years in the past.
Tether can freeze tokens immediately on the blockchain by blacklisting pockets addresses when requested by authorities.
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Tether helps governments freeze funds
On Tuesday, Tether introduced that it has assisted the US Division of Justice in seizing practically $61 million in USDt tied to “pig-butchering” scams, a scheme by which criminals construct relationships with victims earlier than persuading them to ship cash.
Earlier this month, the corporate additionally froze roughly $544 million in cryptocurrency on the request of Turkish authorities, blocking funds tied to an alleged unlawful on-line betting and money-laundering operation.
In line with blockchain analytics agency Elliptic, by late 2025, stablecoin issuers Tether and Circle had blacklisted round 5,700 wallets holding about $2.5 billion, with roughly three-quarters of the addresses containing USDt once they have been frozen.
Associated: Tether USDT provide set for greatest month-to-month decline since 2022 FTX collapse
USDt provide shrinks
As Cointelegraph reported, USDt is on monitor for its largest month-to-month provide drop in three years, with circulating provide falling about $1.5 billion in February after a $1.2 billion decline in January, in response to blockchain information. The contraction echoes the interval following the FTX collapse in late 2022 and will level to tighter liquidity in crypto markets.
Tether stated the figures mirror short-term distribution modifications somewhat than weakening demand, noting USDC (USDC) additionally noticed a multibillion-dollar discount throughout the identical interval.
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