Tether says it froze $225M in USDT following DOJ collaboration

The frozen funds were linked to a “human trafficking syndicate in Southeast Asia”

article-image

designstripe/Shutterstock modified by Blockworks

share

Tether says it participated in an investigation leading to the largest freeze of USDT in history.

The Department of Justice led the investigation in collaboration with OKX and Tether. Roughly $225 million in USDT was frozen. 

“During a months-long investigative effort by Tether and OKX, US law enforcement agencies, including the DOJ, were proactively alerted to the location of the illicit funds by analyzing the flow of those funds through the blockchain. These actions prompted the initiation of a freeze request by the United States Secret Service and a voluntary freeze by Tether,” the press release said.

The funds were linked to a Southeast Asia-based human trafficking ring “responsible for a global ‘pig butchering’ romance scam.”

The US Secret Service San Francisco Field Office hosted an Ask Me Anything on Reddit where they revealed that crypto-based pig butchering scams were one of the most popular scams they come across. The scam — named after the way a pig is fattened prior to slaughter — sees an attacker develop a relationship with the victim either in a friendly or romantic way prior to exploiting them.

“In San Francisco specifically, we tend to focus on victim-based cases, meaning those where there’s an individual(s) or company that’s been affected. These days we see a ton of pig butchering investment scams and have devoted resources to help those victims,” the USSS said at the time.

Tether, back in October, said it had frozen wallet addresses linked to terrorism in both Ukraine and the Middle East — with the latter linked to Hamas.

The funds totaled over $800,000 millions short of the Monday freeze. Tether said at the time that it was committed to “working closely” with law enforcement to crack down on crypto-funded terrorism. The commitment, it seems, applies to crimes as well.

In late October, however, Senator Cynthia Lummis and Representative French Hill penned a letter to the DOJ’s Attorney General Merrick Garland targeting both Tether and Binance. 

The duo asked Garland to “expeditiously conclude [their] investigations into the ongoing illicit activities involving Tether.”

Tether pushed back against the letter, saying “there is simply no evidence that Tether has violated Sanctions laws or the Bank Secrecy Act through inadequate customer due diligence or screening practices.”

The DOJ didn’t immediately return a request for comment.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Unlocked by Template (7).png

Research

Union’s improvements upon Tendermint consensus through CometBLS, coupled with ZK proving through Galois, allow for a broadly scalable, cost efficient, and low latency IBC implementation that is feasibly scalable across every existing blockchain, virtual machine and runtime. The implementation offers modular crosschain interoperability without the need for trusted intermediaries.  

article-image

The drop gives buyers Adidas outfits for their in-game characters, but the game hasn’t fully released yet

article-image

In 1999, Daniel Bernstein fought for code to be protected, just like free speech

article-image

Sentora aims to create an ecosystem focused on institutional investors’ DeFi needs

article-image

Using Bitcoin as a model, Vitalik’s new priority for Ethereum is technical simplicity

article-image

Solana leaders privately told validators to upgrade their software