Tether Takes Action Against Phishing, Freezes $5.2 Million in USDT

Last Updated on May 14, 2024

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An investor's analyzing the tether $usdt coin on screen. Source: maurice norbert - stock.adobe.com

Key Takeaways:

  • Tether’s Proactive Security Efforts: Tether has frozen $5.2 million in USDT linked to phishing scams across 12 Ethereum wallets, continuing its extensive track record of taking action against cybercrime and money laundering.
  • Historical Context and Impact: Historically, Tether has blocked over $1 billion in assets to combat crimes, including blocking $1.3 billion in transactions related to various illicit activities, with a portion tied to terrorist funding.
  • Ongoing Collaboration and Enhancements: Tether works closely with law enforcement, handling 198 requests in the past year and employing advanced controls to block transactions tied to individuals or entities on sanction lists, showcasing the blending of decentralized ledger technology with centralized oversight.

Stablecoin giant Tether has recently blocked $5.2 million in its currency, USDT, specifically targeting funds tied to phishing scams.

This action involved freezing assets across 12 Ethereum wallets, which were identified under the label “USDT Banned Address.”

According to the chief security officer at the on-chain analytics firm SlowMist, these addresses were implicated in the laundering of money derived from phishing operations, although detailed specifics were not provided.

Tether’s history of proactive measures against illicit activities is extensive.

Since its inception, the company has secured over $1 billion in assets to thwart a variety of cybercrimes, including hacks, exploits, and scams.

Tether’s CEO, Paolo Ardoino, disclosed via a social media post that the firm has impeded transactions amounting to more than $1.3 billion, with roughly $1.6 million tied specifically to terrorist funding.

The stablecoin issuer’s rigorous monitoring extends back to January 2022 when it blacklisted three Ethereum addresses that held over $150 million in USDT.

This pattern of decisive action continued throughout the years, with significant sums frozen periodically, such as $8.2 million in October 2022 and $360 million throughout late 2022.

In recent months, Tether intervened to freeze funds linked to terrorist activities and romance scams, with the respective amounts totaling $817,000 in October 2023, and $225 million a month later.

In its ongoing effort to safeguard its network, Tether has collaborated with 24 law enforcement bodies from over 40 countries.

Over the past year, the firm has responded to 198 law enforcement requests, resulting in the blocking of numerous wallets. Over the last three years, the total requests handled reached 339.

Further enhancing its security measures, Tether has implemented controls that prevent transactions associated with individuals or entities on the United States Office of Foreign Assets Control’s Specially Designated Nationals list.

This includes any entities controlled by or belonging to sanctioned countries.

The capability of crypto firms to monitor transactions through decentralized ledger technology, combined with the centralized control typical of stablecoins, enables issuers like Tether to effectively respond to illegal activities based on law enforcement demands.

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