USDT Stablecoin issuer, Tether, has disclosed that it has frozen approximately $4.2 billion worth of its USDT tokens since 2023 because they were tied to criminal activity in a sign of growing cooperation with law enforcement as authorities clamp down on misuse of cryptocurrency.
Tether has the technical ability to remotely block tokens held in users’ wallets at the request of police and regulators. Most of the freezes have occurred over the past three years reflecting increased scrutiny of crypto’s role in illicit finance.
A classic example was the November 2023 freeze which waw ~$225 million was frozen in external self-custodied wallets linked to an international human trafficking syndicate in Southeast Asia.
MILESTONE | Tether Voluntarily Freezes $225 Million in Stolen USDT – The Largest Ever Freeze of USDT in History
Tether said it recently assisted the U.S. Department of Justice in freezing nearly $61 million in USDT linked to ‘pig-butchering‘ scams, a type of fraud in which criminals build trust with victims before tricking them into sending money. That action was part of the total frozen amount,of which roughly $3.5 billion has been blocked since 2023.
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In earlier cases, Tether also blocked wallets allegedly tied to human trafficking, sanctioned groups and wartime actors, including reportedly freezing funds related to the Russian crypto exchange, Garantex.
The moves come as global regulators, particularly the Financial Action Task Force (FATF), push for stronger rules on crypto crime and anti-money-laundering amid wider concerns about the sector’s use in fraud, sanctions evasion and other illegal activity.
Recent research shows crypto-related money laundering grew sharply in recent years, underlining the challenge for both industry and authorities.
2025 RECAP | Illicit Stablecoin Activity Surged to 5-Year High in 2025 with Over 80% Used for Sanctions Evasion
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