Tether suspends $5.2m worth of suspicious transactions

The issuer of the Tether stablecoin has halted 12 transactions worth a total of $5.2 million in USDT

Blockchain security service MistTrack broke the news on social media platform X, outlining the suspicious USDT transactions which were tied to 12 blacklisted addresses and wallets.

According to MistTrack, the issuer chose to step in not only because of the dubious status of the wallet that was sending the money, but also because the funds may be linked to money laundering.

All funds have been frozen and are suspended, unable to be moved in or out, or traded. The incident, though, serves as a reminder that issuers may have a greater say in what happens on their networks, a prospect that not many libertarian-minded blockchain uses relish.

Yet, USDT has been increasingly used to hide the provenance of ill-gotten assets, with Bitcoin, Dogecoin and Tether proving to be the most popular storage vessels for such transactions. According to another crypto company, TRM Labs, at least $34 billion worth of crypto assets that come from crime or are tied to crimes was moved in 2023 alone.

Tether, though, may not enjoy this form of self-custody for much longer, as the US government is closing in on the company and now looking to go after the company over what some industry insiders have claimed is a well-known problem. This has been confirmed in a recent interview with Ripple Labs CEO Brad Garlinghouse.  

Collaboration between law enforcement agencies and issuers of crypto tokens is not really that new. Tether, for example, has blocked at least $639 million worth of cryptocurrencies on its network that law enforcement agencies in the United States have requested it to.

The total number of blocked funds is much higher, however. Since Tether began circulation, there has been more than $1.3 billion blocked by the issuer in a bid to comply with international law enforcement efforts. This does not mean that law enforcement, especially in the United States, won’t put the onus on Tether to throttle such trades and transactions.

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Written by Barney


Barney is co-founder of CryptoGamblingNews.com. When not at work he can usually be found behind a Nikon. He's won numerous international competitions for his photography and volunteers as a content creator for aid organisations in Africa.

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