Tether, the stablecoin issuer, has frozen about $5.2 million on addresses believed to be operated by scammers.
Blockchain Analytics Store SlowMist mentioned 12 Ethereum addresses with deactivated Tether (USDT) holdings were involved in the freeze. Each wallet was labeled as a “blocked USDT address,” and a security researcher at SlowMist said the funds appeared to be linked to a criminal gang connected to the chain.
Phishing is rampant in the cryptocurrency space, where bad actors mimic native platforms or decentralized applications to steal private keys and compromise wallets.
Scammers continue to launch attacks, but security experts note that users and platforms have developed strong defenses against these scams. According to CertiK, last month marked the lowest amount lost to scams and phishing hacks since 2021. Bad actors were only able to steal $25.7 in April, according to reports.
Tether centralization may help combat illicit wealth
Freezing stolen cryptocurrency wealth is usually difficult as decentralized entities may adopt a model resistant to excessive censorship. In such cases, Tether's centralized structure may help stop criminal activity.
This is also not the first time a stablecoin issuer has intervened. In March, Tether blacklisted four addresses holding more than $20 million in USDT as part of a crackdown on criminal use of its stablecoin.
The company promised to strengthen its operations against illicit activity following allegations from the United Nations alleging negligence by the USDT operator. In a letter to US lawmakers, Tether also confirmed its intention to expand the spotlight on illicit cryptocurrency transactions carried out via stablecoin corridors.
