Tether Freezes $225 Million in USDT After DOJ Investigation, Calling It ‘Largest-Ever Freeze of USDT’

Tether has announced the “largest-ever freeze of USDT in history.” In collaboration with crypto exchange Okx, Tether froze $225 million in USDT following an investigation by the U.S. Department of Justice (DOJ). The tokens were allegedly linked to an international human trafficking syndicate in Southeast Asia responsible for a global “pig butchering” crypto scam.

$225M in USDT Frozen by Tether

Leading stablecoin issuer Tether and crypto exchange Okx announced Monday that they have collaborated with the U.S. Department of Justice (DOJ) “in an investigation that led to Tether proactively and voluntarily freezing approximately 225 million in USDT tokens in external self-custodied wallets.” The wallets are “linked to an international human trafficking syndicate in Southeast Asia responsible for a global ‘pig butchering’ romance scam,” the crypto companies detailed, adding:

The joint investigation was conducted using tools from blockchain analysis firm Chainalysis, and the action by Tether represents the largest-ever freeze of USDT in history.

After months of investigation, Tether, Okx, and law enforcement agencies, including the U.S. DOJ, identified the locations of the illicit funds, the announcement explains, noting: “These actions prompted the initiation of a freeze request by the United States Secret Service and a voluntary freeze by Tether.”

According to an analysis by Lookonchain, Tether froze 37 wallets linked to a human trafficking group on Monday. These wallets had been moving USDT to crypto exchange Okx.

Tether froze ~225M $USDT (37 wallets) linked to a human trafficking group 1 hour ago.

These wallets had been moving $USDT before being frozen, with most of the $USDT being transferred to #OKX.

Check frozen TX here.https://t.co/TlfFJvpgiW pic.twitter.com/vEMTd3YzBq

— Lookonchain (@lookonchain) November 20, 2023

Tether claimed: “The frozen wallets are on the secondary market and are not associated with Tether’s customers.” The crypto firm emphasized: “To the extent lawful wallets were captured by this operation, Tether will work quickly with law enforcement and the owners of those wallets to unfreeze them, as appropriate.” In October, Tether froze 32 addresses linked to suspicious operations in Israel and Ukraine.

Pig butchering crypto scams have been on the rise globally. The Federal Bureau of Investigation (FBI) has repeatedly warned about these scams. In August last year, U.S. authorities said that this type of scam is becoming alarmingly popular. In April this year, the U.S. Department of Justice seized cryptocurrency worth $112 million in a pig butchering scam crackdown. Last week, the Internal Revenue Service (IRS) warned that U.S. taxpayers are currently the most targeted population for pig butchering schemes.

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