Tether, the issuer of the USDt stablecoin, has frozen approximately $4.2 billion of its tokens linked to suspected criminal activity over the past three years. The majority of these freezes occurred since 2023 as regulatory scrutiny intensified. The company recently collaborated with U.S. and Turkish authorities to seize tens of millions in assets tied to specific scams and illegal operations.
Stablecoin issuer Tether has reportedly frozen roughly $4.2 billion worth of its USDt tokens connected to suspected criminal activity over the past three years. Most of these funds were blocked since 2023 as regulators increased their focus on crypto-related fraud and sanctions evasion.
The company recently assisted the U.S. Department of Justice in seizing nearly $61 million in USDt tied to “pig-butchering” scams. Tether also froze approximately $544 million at the request of Turkish authorities, blocking funds linked to an alleged illegal online betting and money-laundering operation.
According to blockchain analytics firm Elliptic, stablecoin issuers Tether and Circle had blacklisted around 5,700 wallets holding about $2.5 billion by late 2025. Roughly three-quarters of these addresses contained USDt when they were frozen.
The circulating supply of USDt has contracted recently, falling about $1.5 billion in February after a $1.2 billion decline in January. This marks the largest monthly supply drop in three years, echoing the period following the FTX collapse in late 2022.
Tether stated the figures reflect short-term distribution changes rather than weakening demand. The company noted that its competitor, USDC, also saw a multibillion-dollar reduction during the same period.
