Tether froze more than a million dollars in USDT belonging to a single Ethereum address. The reasons are unknown, but a spokesperson suggested it could be due to a criminal investigation.
The issuing company of the stablecoin USDT, Tether, froze USDT funds from an address of Ethereum unknown that holds more than a million dollars in various cryptocurrencies.
As reported The Block, Tether activated the function “AddedBlacklist“Last December 30 to add the address”0xc390A623AABD2964Dc72ed8a8F1BD26A8AAbd200”To your blacklist. The function freezes the USDT coins deposited in that direction, disabling the user to move the funds.
It is not clear who owns the address of Ethereum, which maintains a fortune of USD $ 1.2 million spread over 31 tokens, according to data from Etherscan.io. It should be noted that the largest volume of wealth is deposited in the stablecoin USDT, now locked funds, representing $ 1,091,557. The other remaining $ 200,000 is divided into cryptocurrencies such as Chainlink (LINK), Phantom (FTM), SAND and others.
Tether blocks suspicious addresses
Although the identity of the owner of said address and the reason for the capital blocking are unknown, the report suggests that it could be related to a case of investigation by the control agencies.
A spokesperson for Tether that was consulted by The Block declined to share the details of the case to maintain the owner’s privacy, but indicated that the company works regularly with regulators and law enforcement agencies all over the world, including in any case related to hacking and scams, to freeze addresses.
“By freezing addresses, Tether has been able to help recover funds stolen by hackers or compromised“, Said the spokesman to the aforementioned medium.
At the time of publishing, the USDT issuing firm has not provided public information about the case.
Tether it has proceeded to freeze funds at other times in the past. In February of last year, the company froze USD $ 1.7 million in USDT stolen from an address involved in the hack to the decentralized finance platform (DeFi), Yearn.Finance. The company did the same two years ago, freezing more than $ 30 million in USDT after a massive theft of the exchange. KuCoin.
According to data from The Block, Tether has blocked more than 500 addresses from Ethereum since activating its blacklist feature in 2017. The company also has a “Recovery” which means that you can freeze USDT and then reissue it in certain cases. For example, in cases of USDT transactions to wrong addresses, you can help recover funds by freezing the sent USDT and reissuing new currencies.
Centralized vs. decentralized stablecoins
In the past, the extensive capabilities of Tether to freeze and destroy funds from the stablecoins at private addresses has caused controversy in the digital currency community. On Twitter, users have shared their discontent and some criticism of the company, saying that such actions goes against the decentralized nature of the crypto space.
However, the executives of Tether They have stated that the company only intervenes in particular cases such as cyber attacks, theft and loss of funds. The CTO of Tether, Paolo Ardoino, had responded to these criticisms in February:
I want to take this opportunity to remind everyone that Tether $ USDt is a centralized stablecoin that uses blockchains as a transport layer. Among Tether’s roles is the responsibility to act and collaborate with LE and regulators regarding potential unsafe behavior.
Not all cases of crashes Tether have been linked to hacking attacks. In fact, on one occasion, Ardoino helped a user to recover $ 1 million in USDT that he had mistakenly sent to the wrong address.
However, despite the fact that these functions have been used in some cases for good deeds in the past, many users in the community have recommended the use of stablecoins decentralized – such as UST of Terra and DAI of MakerDAO– to prevent an entity from taking control of the funds. Other stablecoins like USDC, from Circle, also have the ability to lock.
Article versioned by Hannah Estefanía Pérez / Daily bitcoin
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Tether froze funds to an address holding more than $ 1 million in USDT