Tether freezes wallets involved in suspicious USDT transfers

abdelaziz Fathi

Tether, the issuer of the world’s largest stablecoin, has blacklisted over 30 cryptocurrency addresses that have received billions of USDT.


This action, which is one of the largest operations of its kind for Tether, was carried out in collaboration with blockchain intelligence firm Chainargos.

The blacklisted addresses had received a total of $161 million from Whitebit, a European cryptocurrency exchange with Ukrainian roots. Many of these addresses were involved in the movement of STUSDT, a token that users receive after staking USDT.

Chainargos had previously identified a large number of wallets engaged in “programmatic spamming” operations involving small transactions of STUSDT, which it observed in August.

On December 1, Tether froze 28 of these addresses, and on December 2, an additional six addresses were blacklisted after moving more than $10 million, with assets worth roughly $1 million. The frozen wallets were often linked to STUSDT movements.

Tether has not provided specific reasons for these actions, but the stablecoin company has been cooperating with the U.S. Department of Justice (DOJ) in freezing funds linked to illegal activities. In November, Tether voluntarily froze $225 million associated with human trafficking groups in Southeast Asia, calling it the “largest-ever freeze of USDT.”

Tether’s USDT is the third-largest cryptocurrency by market capitalization and is widely used for trading and transferring value in the crypto market.

Earlier in November, Tether and its sister crypto exchange Bitfinex decided to withdraw their opposition to a Freedom of Information Law (FOIL) request initiated by journalists, including Bloomberg Businessweek’s Zeke Faux.

In a corporate statement, the stablecoin issuer indicated that this decision aligns with its commitment to transparency, yet this will not result in the release of all their documents, citing standard business practices.

Tether accused Zeke Faux’s prior work related as occasionally ventured beyond the confines of traditional professional journalism. Furthermore, the statement cited instances of “biased and factually inaccurate reporting” from several media outlets, including the Wall Street Journal and Bloomberg, whose journalists are involved in this FOIL request.

This isn’t Tether’s first encounter with a FOIL request; they previously attempted to block a request by CoinDesk that sought documents about Tether’s reserves during an inquiry by the New York Attorney General (NYAG) into whether USDT was fully backed by reserves. After losing in court, Tether is not appealing the decision and, instead, accepted to engage with journalists and regulators “who meet ethical reporting standards and respect privacy.”

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