Tether (USDT) has blacklisted 39 Ethereum addresses valued at USDT 46 million, of which 24 have a total of over USDT 5.5 million. This revelation comes on the first Center blacklist of an Ethereum address with 100,000 USDC.
Philippe Castonguay, Ethereum researcher at Horizon Games, used Dune Analytics to create a dashboard that tracks the number of addresses blacklisted by Center and Tether. The largest address is over USD 4.5 million and was only recently blacklisted, on April 5th.
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Similar to blacklisted addresses that contain USDC, tether addresses that receive a blacklist function can no longer perform tether transactions, freezing any existing currency found in the address.
Bitfinex (Tether’s sister company) Attorney General Stuart Hoegner told the media that Tether works with international law enforcement agencies and blacklists addresses when necessary:
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„Tether routinely assists law enforcement in their investigations… Through the address freeze function, Tether has been able to help users and exchanges save and recover tens of millions of dollars that hackers have stolen“.
Reasons for caution
Arcane Assets CIO Eric Wall stated on Twitter that the most recent freeze occurred on June 14; the 939,000 USDT received from Binance was held only 22 hours before the blacklist occurred.
Aside from this, Wall added, most of the other freezes were purely precautionary actions:
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„Most of the other freezes seem to have been made on Ethereum accounts either for precautionary reasons (possibly identified as scams/fraud) or to protect others from making mistakes (such as the 0x000…0001 freeze). 3 addresses were defrosted after the freezing“.
This recent development further increases the distrust in the central organizations of the cryptosystem world, especially by creating a specific resistance to stablecoins and their ability to be censored. One user commented on Castonguay’s Twitter that Dai (DAI) and sUSD are the only stablecoins resistant to censorship.