- Tether freezes $38.4M USDT as ZachXBT links funds to $150M DSJ and BG fraud collapse case.
- ZachXBT says $92M moved via cross-chain swaps and wallets before authorities stepped in.
- Regulators across countries warned BG Wealth Sharing of fake returns and licensing claims.
Tether has frozen $38.4 million in USDT linked to a suspected fraud involving DSJ Exchange and BG Wealth Sharing, according to on-chain investigator ZachXBT. The scheme is estimated to have grown to about $150 million before collapsing last week.
In a post on X, ZachXBT said he coordinated with Binance, OKX, and U.S. law enforcement to track the movement of funds across chains. As a result, more than $41.5 million has now been frozen across different platforms, with the largest share coming from Tether on the TRON network. Investigators traced the transactions using cross-chain tracking and timing analysis to map how the funds moved.
Investigators Trace Complex Fund Flows
ZachXBT said the scheme moved more than $92 million between April 27 and May 3. The actors used token swaps, cross-chain bridges, and wallet layering to obscure the flow of funds. He traced deposits moving through Solana and TRON into exchange-linked wallets.
A blacklist action later flagged 19 TRON addresses holding large USDT balances. One wallet alone contained about $9.4 million. The freeze therefore, covered a broad network of linked accounts rather than a single wallet.
Regulators had already raised concerns about BG Wealth Sharing. The Alberta Securities Commission warned about misleading claims linked to AI-based trading strategies. In addition, the Utah Division of Securities flagged unregistered investment activity and false licensing claims tied to the operation.
Global Warnings and Growing Scrutiny
Several regional regulatory bodies had already given out warnings even before the failure. In 2025, the Financial Conduct Authority classified it as an unauthorized platform. Regulatory bodies in both New Zealand and Tonga associated it with the entire Ponzi scheme system.
ZachXBT said the operators promised daily returns of up to 2.6% to attract investors. However, withdrawals stopped before the collapse, and users were later asked to pay a 12% “tax” to unlock funds. Regulators have long warned that such charges often signal exit scams.
Scrutiny has since expanded beyond this case. ZachXBT also yesterday accused Tokenlon of processing illicit trading volume linked to fraud networks and underground markets. The claims have increased pressure on decentralized platforms to strengthen monitoring and compliance.
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