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Tether has frozen $344 million in its USDT stablecoin linked to illicit activity, marking one of the largest single enforcement actions by the company to date.
The announcement, made April 23, follows information shared by U.S. authorities regarding wallets associated with unlawful conduct. Tether said it acted by restricting the flagged addresses, preventing them from sending or receiving funds.
“When wallets are identified as connected to sanctions evasion, criminal networks, or other illicit activity, Tether can move to restrict those assets,” the company said in a statement, describing the process as a routine part of its cooperation with law enforcement agencies globally.
Tether’s flagship asset, USDT, is the largest stablecoin by trading volume, and the company emphasized that its scale allows it to play an active role in monitoring and responding to suspicious activity. According to the firm, it has supported more than 2,300 law enforcement cases worldwide, contributing to the freezing of over $4.4 billion in assets.
CEO Paolo Ardoino said the latest action reinforces the company’s stance that stablecoins are not a safe haven for bad actors.
“USDT is not a safe haven for illicit activity,” Ardoino said. “When credible links to sanctioned entities or criminal networks are identified, we act immediately and decisively.”
The company argues that public blockchains provide a key advantage over traditional financial systems by offering transparency. Transactions can be traced in real time, allowing investigators to identify suspicious flows and enabling issuers like Tether to intervene directly at the token level.
The freeze comes amid heightened scrutiny of security across the crypto ecosystem. Recent incidents, including the exploit of Kelp DAO, have highlighted evolving attack vectors that target smart contracts and cross-chain infrastructure and messaging layers.
At the same time, Tether has taken a more active role in stabilizing parts of the market following breaches. The company recently committed $147 million to support the recovery of Drift Protocol after a separate exploit, with plans for the platform to adopt USDT as its settlement layer.
