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Tether Freezes 225 Million in USDT Linked to Human Trafficking

2 mins
Updated by Ryan Boltman
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In Brief

  • Tether, the USDT issuer, has frozen a record $225 million linked to human trafficking operations.
  • The company collaborated with OKX crypto exchange and the U.S. Department of Justice in this operation.
  • Blockchain analysis firm Chainalysis was also instrumental in helping Tether's operation of block the human trafficking syndicate's access to USDT.
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USDT issuer – Tether has conducted the largest-ever freeze in history, blacklisting $225 million linked to human trafficking.

While many consider crypto the most preferable mode of transaction for criminals, proactive actions by crypto firms prove otherwise.

How Tether Collaborated With Other Companies to Freeze 225 Million USDT 

Tether announced that it has worked with the OKX crypto exchange and the United States Department of Justice (DoJ) to block a human trafficking syndicate’s access to the USDT stablecoin

Tether took the help of the blockchain analysis firm – Chainalysis to track the location of the funds. The joint investigation lasted approximately one month, and then the United States Secret Service instructed Tether to freeze the funds. 

Read more: How To Evaluate Cryptocurrencies with On-chain & Fundamental Analysis.

The 225 million were linked to a Southeast Asia human trafficking syndicate that conducted “pig butchering” scams. The screenshot below shows that one of the criminals’ wallets had over 87.4 million USDT, which is now blacklisted by Tether.

Token holdings of criminal
Token Holding of One of the Criminals’ Wallets. Source: Etherscan

The United States Secret Service has also been trying to raise awareness about pig butchering in Pennsylvania’s largest city – Philadelphia.

Pig butchering is a crime where victims’ money is stolen by promising them exposure to certain investment schemes. Michael Centrella, Special Agent in Charge of the Philadelphia Field Office, said, warning about the crimes:

“We urge anyone who is investing in cryptocurrency to be vigilant and cautious, and to report any suspicious activity to the Secret Service or local law enforcement.”

How Crypto Transaction Could Cause Trouble For Criminals

Tether said:

“The transparency of blockchain transactions serves as a powerful deterrent to illicit activities, setting a significant precedent for the industry.”

Indeed, the firms’ efforts indicate that it’s completely possible to track illicit transactions through crypto due to the traceability of blockchain technology. In fact, Tether has conducted various such freezes in the past.

In January 2022, it blacklisted three addresses, effectively freezing around $150 million worth of USDT. In October, BeInCrypto reported that Tether collaborated with Israel’s National Bureau for Counter-Terror Financing (NBCTF) and blocked 32 wallet addresses, holding approximately $873,118.
In September, the Executive Director of Europol, Catherine De Bolle, said that criminals are reluctant to use crypto due to law enforcement’s recent successful seizures of illicit crypto. She specified that crypto is less than 1% of the criminal’s total transaction volume.

Read more: 8 Best Crypto Wallets to Store Tether (USDT)

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Harsh Notariya
Harsh Notariya is a journalist at BeInCrypto, who writes about various topics, including decentralized physical infrastructure networks (DePIN), tokenization, crypto airdrops, decentralized finance (DeFi), meme coins, and altcoins. Before joining BeInCrypto, he was a community consultant at Totality Corp, specializing in the metaverse and non-fungible tokens (NFTs). Additionally, Harsh was a blockchain content writer and researcher at Financial Funda, where he created educational reports on...