Home / News / Crypto / Tether / USDT Banned List: 12 Addresses Blacklisted as Tether Aims to Prove US Government Wrong
4 min read

USDT Banned List: 12 Addresses Blacklisted as Tether Aims to Prove US Government Wrong

Published 7 days ago
Shraddha Sharma
Published 7 days ago

Key Takeaways

  • Tether reportedly froze 5.2m in USDT linked to 12 addresses.
  • Tether has previously blacklisted addresses connected to suspicious activities.
  • Ripple’s CEO highlighted potential regulatory actions against Tether.

Tether has reportedly frozen 5.2m USDT across 12 addresses that could potentially be linked to illicit activities. This action appears to be part of Tether’s ongoing efforts for financial compliance and to avoid scrutiny from the regulators.

In March, Tether banned addresses believed to have a connection to suspicious activities. The stablecoin issuer has been pulled up several times for providing a channel to circumvent sanctions and launder illicit funds. 

Tether’s Freezing of USDT 

According to on-chain analytics firm SlowMist, Tether’s 12 banned addresses were identified as “USDT Banned Address“.

This is not the first time Tether has taken such action. In March, PeckShieldAlert reported that Tether blacklisted at least 3 addresses holding large amounts of USDT. One address included a balance of 20m USDT. Tether’s measures appear to be a part of its broader strategy to prevent the misuse of its stablecoin for illegal activities.

Tether could have taken action against addresses for connections to criminal activities or as a preventive measure against potential scams. These addresses could also have been flagged by a government agency. 

But by freezing these addresses, Tether aims to uphold its integrity in the eyes of law enforcement. 

Tether Balancing Out Scrutiny 

Ripple CEO Brad Garlinghouse recently commented on the US government’s stance towards Tether in an interview . He stated, “The US government is going after Tether, that is clear to me.”

Garlinghouse also emphasized Tether’s crucial role in the cryptocurrency market and the uncertainty surrounding potential regulatory actions.

He described the situation as “an interesting one to watch,” acknowledging Tether’s importance without speculating on specific outcomes.

At press time, Tether holds a market cap of $110b, making it the third-largest cryptocurrency and the largest stablecoin. It also leads in 24-hour trading volume, with $56b traded, as per  CoinMarketCap.

The trading volume indicates high liquidity and constant demand for Tether, underscoring its importance.

Tether’s Regulatory Problems 

In recent efforts to align with regulatory expectations, Tether has started assisting law enforcement operations.

On March 12, 2024, Tether said he  helped the US Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI) seize around 1.4m USDT from a tech support scam network. 

In April, Tether came under scrutiny from the US Treasury Department. Concerns were raised over the potential misuse of cryptocurrencies, particularly stablecoins like Tether, to bypass international sanctions. The Treasury highlighted the risk of stablecoins enabling illicit activities, including those by state actors like Russia.

A UN report previously  also targeted USDT by stating, “While stablecoins such as USDT remain the cryptocurrency of choice for organized crime in East and Southeast Asia, it can be easy to justify unexpected wealth through rapid increases in exchange rates of other virtual assets that exhibit exponential growth.”

Tether’s Effort for Regulatory Compliance 

Continued actions to freeze addresses linked to phishing and money laundering activities may be a proactive stance to avoid more regulatory scrutiny and potential government actions.

At the same time, Tether continues to play a major role in the market. And as regulations evolve, Tether’s efforts to cooperate with authorities and maintain transparency could be crucial. 

Was this Article helpful? Yes No