Tether, the world’s largest stablecoin issuer, has announced a freeze on 32 blockchain addresses with connections to terrorist groups in both Israel and Ukraine.
In a Monday statement, the company said it has been combatting crypto-funded crime in collaboration with Israel’s National Bureau for Counter Terror Financing (NBCTF). In total, the frozen addresses hold $873,118.34 worth of assets.
“Tether’s ability to freeze and return stolen funds to legitimate users demonstrates the innovative new capabilities and level of security that blockchain technologies can bring to the global financial system,” the statement read.
Unlike more traditional cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH), stablecoins—such as Tether’s USDT—are directly issued by centralized entities, and backed by centralized reserves of real-world assets. In practice, that means users holding stablecoins can be programmatically frozen out of their money at government request, much like traditional bank deposits.
Tether has previously used its powers to freeze millions of dollars lost to both DeFi hackers and phishing scammers. However, it refused to freeze addresses tied to privacy protocol Tornado Cash after the U.S. Treasury placed sanctions on it last year, despite rival stablecoin issuer Circle opting to comply with the sanctions.
Altogether, Tether has complied with 31 different agencies across the world from nations like the United States, Canada, Brazil, South Korea, and others to freeze over $835 million in criminal-connected crypto to date.
“Contrary to popular belief, cryptocurrency transactions are not anonymous; they are the most traceable and trackable assets,” explained Tether CEO Paolo Ardoino in a statement. “Criminals foolish enough to employ cryptocurrencies for illegal activities will inevitably be identified.”
Following deadly attacks from Hamas against Israel earlier this month, Israeli authorities froze crypto accounts suspected of being connected to Hamas, including those on crypto exchanges like Binance.
Data from Chainalysis indicates that crypto has helped Hamas secure tens of thousands of dollars in Bitcoin donations since 2019. Pro-Russian groups in the Russia-Ukraine conflict have also used over $2 million raised in Bitcoin and Ethereum to help fund their war effort.
Edited by Stacy Elliott.
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