Tether against crypto scams: 5 million in USDT stablecoin seized

Once again Tether, a well-known cryptographic provider of stablecoin, has been engaged in an activity to combat scams in cooperation with the US authorities.

Recently, Paolo Ardoino’s company took part in an investigation by the Department of Justice (DOJ) helping the feds to seize as much as 5 million dollars in USDT.

The money came from an illegal scheme related to cryptocurrency investment scams, which was affecting various American citizens.

Let’s see all the details of the matter below.

Tether assists the USA authorities and blocks a crypto scam worth 5 million dollars

A few days ago, the United States Attorney for the Eastern District of North Carolina announced the seizure of 5 million dollars in stablecoin from a crypto scam, thanks to the collaboration of the company Tether.

The seized funds, distributed in the form of USDT, are believed to originate from a fraudulent crypto investment scheme known as “pig butchering.”

In this scam, US users were invited to invest in crypto under the promise of guaranteed large profits, only to be robbed by the scammers.

In particular, according to what the lawyers who are reading the documents have stated, the goal of the criminals was to establish a romantic relationship with the victims.

These latter, as they were gradually introduced into platforms of crypto trading fictitious, with names that mimic those of existing and legitimate exchanges.

However, when they deposited funds with the scam broker, the funds were directed to a foreign account, leaving the unsuspecting with the short end of the stick.

In this regard, lawyer Michael Easley, who is closely following the matter, in a recent interview literally stated that:

“Americans are losing their life savings due to investment frauds while funds are quickly transferred to cryptocurrency accounts abroad. We are determined to seize their illegal proceeds and return money to the victims.”

In this case, the agents of the Federal Bureau of Investigation (FBI) managed to trace the scam’s stablecoin funds with the help of Tether.

The cryptographic company, engaged in the issuance and management of “monete stabili”, assisted the federal entity in the transfer of digital funds.

In response to the success of the operation, FBI special agent in charge Robert M. DeWitt stated that:

“This seizure of cryptocurrency serves as an example of the FBI adapting to the changing criminal landscape and fighting for the victims of cyber-enabled fraud schemes.”

The stablecoin USDT is in support of the DOJ and the FBI

As mentioned, the availability of Tether has been crucial for both the DOJ and the FBI to identify the scammers and recover the money in stablecoin from the scam.

The technological company of Paolo Ardoino, based in the British Virgin Islands, has always been available to supervisory authorities and international regolamentazione.

Since its inception in 2014 until today, it has assisted over 145 law enforcement agencies in 40 jurisdictions, redistributing 108.8 million dollars in USDT to the legitimate owners.

The extensive cryptographic background of Tether’s collaborators, combined with the protocol rules that allow to “freeze” stablecoins deposited on EVM addresses, has enabled the blocking of over 1,900 wallets linked to illicit activities.

According to data from Dune.Analytics, the value of USDT currently locked in these addresses amounts to more than 1.2 billion dollars.

The latest ban is from 3 days ago and concerns a wallet with just over 14,000 USDT

Source: https://dune.com/phabc/usdt—banned-addresses

The proactive approach of Tether in blocking scams and fraudulent activities orchestrated through its stablecoin reflects its commitment to cryptographic financial transparency.

The digital asset provider indeed aims to limit as much as possible the illicit uses related to USDT, in advance of the crackdown by the US authorities.

It is clear that if Tether in this sense fails to provide support to the FBI or the DOJ in the fight against money laundering, drug trafficking, and financial fraud, it could be attacked by the same.

Precisely for this reason, once again Paolo Ardoino reiterated the company’s commitment to collaborate with law enforcement, stating in a press conference that:

“We unequivocally condemn the misuse of USDT or any cryptocurrency for criminal activities. We are fully dedicated to our ongoing efforts to collaborate with law enforcement to combat fraud.”

However, if on one hand the behavior of Tether is seen favorably because it fights scams, on the other hand it limits the freedom of the crypto world.

In fact, the bans on USDT stablecoin are nothing more than a form of authoritarian and totally discretionary censorship on digital money.

This principle is totally opposed to the founding values of Bitcoin.

The cryptographic empire of Tether 

In addition to the primacy of being a champion of justice against scams, Tether boasts the success of its stablecoin USDT as the most capitalized stable currency in the sector.
The main cryptographic asset of the project holds the record of dominance of 70% compared to the rest of the stablecoin competitors in the broad blockchain industry.

In total, in fact, capitalizes 124.9 billion dollars out of a total of 176.8 billion dollars, making it the largest stablecoin in the world by circulating supply.

Think that 4 years ago it recorded a capitalization of just 14 billion dollars, while in January 2023 it was 72.5 billion dollars.

It is a formidable growth in recent years, with the stablecoin sector having grown overall thanks to its achievements.

Currently USDT is distributed mainly on the blockchains of Tron and Ethereum, with 61.8 and 54 billion dollars respectively present within them.

On one hand, the reserve of USDT on Tron serves to guarantee off-shore exchanges and rapid and economical value transfers.
On the other hand, Tether’s currency on Ethereum guarantees deep liquidity in DeFi, which, competing with USDC, offers a level of confidence with new decentralized finance products.
The stablecoin is also present to a lesser extent on other chains like Arbitrum, Avalanche, Optimism, Ton and others.