- Tether froze $5M in three wallets, highlighting centralization risks in stablecoins like USDT, USDC, and BUSD.
- T3 FCU has frozen over $300M in criminal crypto assets, supporting 23 jurisdictions and strengthening global law enforcement.
- S&P downgraded USDT to “weak” despite Tether holding 116 tonnes of gold worth $15.5B, citing reserve transparency concerns.
Tether (USDT) has once again frozen three wallets, totaling over $5 million, sparking renewed debate over stablecoin safety. The action underscores concerns about centralization in cryptocurrencies, where even “digital cash” can be controlled or restricted.
Besides USDT, other popular stablecoins like USDC, BUSD, PYUSD, TUSD, and USDS remain vulnerable to freezes. The company’s proactive stance aims to curb financial crime but also highlights potential limitations for users expecting decentralization.
This latest enforcement follows Tether’s T3 Financial Crime Unit (T3 FCU) initiative, a collaboration with TRON and TRM Labs. Since launching in September 2024, the T3 FCU has tracked and frozen over $300 million linked to criminal activity worldwide.
Paolo Ardoino, Tether’s CEO, stated, “Reaching the USD 300 million milestone demonstrates the real-world impact of blockchain technology in combating financial crime.” The unit works directly with law enforcement to disrupt money laundering, investment fraud, terrorism financing, and organized crime.
Global Cooperation in Action
As per the announcement, the T3 FCU recently assisted the Brazilian Federal Police in Operation Lusocoin, freezing more than R$3 billion in criminal assets, including 4.3 million USDT. Moreover, the unit has extended support to 23 jurisdictions across North America, Europe, South America, and Oceania. The largest volumes occurred in the U.S., with $83 million frozen across 37 cases.
Other significant operations took place in Spain, Germany, Albania, Bulgaria, Finland, Brazil, Australia, Poland, and the U.K. Consequently, T3 FCU’s coordinated approach strengthens transparency and trust across the blockchain ecosystem.
The unit has also observed rising incidents of “wrench attacks,” where criminals use physical coercion linked to crypto assets. Such developments highlight the growing importance of timely, international coordination to prevent escalating financial crimes.
TRON’s founder Justin Sun emphasized, “The T3 Financial Crime Unit’s USD 300 million milestone is proof that progress happens when technology, institutions, and people work together.” Additionally, TRM Labs CEO Esteban Castaño stressed that no single agency can fight financial crime alone.
Stablecoin Risks and Market Reactions
Despite Tether’s law enforcement collaborations, concerns over asset transparency persist. S&P Global recently downgraded USDT’s rating to “5 (weak)” due to increased high-risk reserves and disclosure gaps.
Tether rejected this, citing flaws in S&P’s framework that overlook USDT’s resilience and global utility. Interestingly, Tether also acquired 116 tonnes of gold worth over $15.5 billion last quarter, becoming the world’s largest independent gold holder.
