Tether and US Govt Freeze $225M USDT Linked to “Pig Butchering” Romance Scam

Leading stablecoin issuer Tether announced on Monday that it had frozen 225 million USDT linked to human trafficking syndicates following close collaboration with the US Department of Justice (DOJ) and crypto exchange OKX.

In an investigation that led to the highest USDT ever frozen, Tether stated that it linked its dollar-pegged assets, stored in external self-custody accounts, to Southeast Asians who scammed victims using the popular pig butchering romance scheme.

An Effective Collaboration

Tether stated that the wallet freeze came from months of collaboration with crypto exchange OKX and the US DOJ in tracking the activities of the accounts linked to the scammers. The stablecoin issuer used tools from blockchain data analyst Chainalysis to monitor cash flows from the self-custody wallet.

Upon tracking the funds, the US Secret Service requested that Tether freeze the account, which the stablecoin issuer voluntarily consented to. Tether’s active participation in curbing the use of crypto to perpetrate crimes was again evident; it had frozen accounts tied to fraudsters in Israel and Ukraine just last month.

Data showed that Tether froze the $225 million from 37 accounts. The majority of the accounts involved had been moving USDT to OKX before the freeze.

Ardoino, Lau Reacts

“Through proactive engagement with global law enforcement agencies and our commitment to transparency, Tether aims to set a new standard for safety within the crypto space. Our collaboration with the Department of Justice underscores our dedication to fostering a secure environment. We believe in leveraging technology and relationships, such as our collaboration with OKX, to proactively address illicit activities and uphold the highest standards of integrity in the industry,” new Tether CEO Paulo Ardoino stated.

“Collaborating with industry stakeholders, including law enforcement agencies, is a key tenet of our approach to building trust and serving the public good as a leader in the crypto industry. At OKX, we will continue to contribute to these initiatives on a proactive basis,” OKX Chief Innovation Officer Jason Lau stated about the freeze.