Tether froze $5.2m USDT from suspected scammers

Stablecoin issuer Tether froze around $5.2 million USDT on addresses believed to be operated by phishing scammers. 

Blockchain analytics shop SlowMist reported that 12 Ethereum addresses with disabled Tether (USDT) holdings were involved in the freeze. Each wallet was labeled “USDT Banned Address”, and a SlowMist security researcher said the funds seemed associated with an on-chain criminal gang. 

Phishing is rampant within the crypto sphere, with bad actors mimicking genuine platforms or dapp to steal private keys and compromise wallets. 

Scammers continue to launch attacks, but security experts noted that users and platforms have developed robust defenses against these scams. According to CertiK, last month marked the lowest amount lost to scams and phishing hacks since 2021. Bad actors could only pilfer $25.7 in April, per reports. 

Tether’s centralization may help combat illicit wealth

Usually, freezing stolen crypto wealth proves difficult as decentralized entities may adopt a hyper-censorship-resistant model. In cases like this, Tether’s centralized structure may aid in stemming criminal activity. 

This is also not the first time the stablecoin issuer has stepped in. In March, Tether blacklisted four addresses holding more than $20 million in USDT as part of a pushback against criminal use of its stablecoin.

The company promised to bolster its operations against illicit activity following claims from the United Nations alleging negligence by the USDT operator. In a letter to U.S. lawmakers, Tether also affirmed the intention to widen its spotlight on illicit crypto transactions executed via stablecoin corridors.