The U.S. government has seized an Ethereum wallet containing roughly $2.12 million in USDT through a civil in rem forfeiture lawsuit. The funds are linked to a “pig-butchering” investment scam that used dating apps, social media, and fake job offers to lure victims. Authorities traced the assets using blockchain analysis to identify the wallet. Tether assisted in freezing the tokens. The U.S. Department of Justice stated the USDT represents proceeds of wire fraud and money laundering, making it subject to forfeiture. The case highlights a broader surge in cryptocurrency investment fraud.
A U.S. government civil forfeiture lawsuit has seized an Ethereum wallet holding 2,117,677.97 USDT, valued at approximately $2.12 million. According to the complaint, the funds originated from a massive “pig-butchering” investment scam.
Scammers approached victims through dating apps, WhatsApp, social media, and phony job offers. They then directed victims to fraudulent cryptocurrency investment platforms that promised guaranteed returns and displayed fictitious profits to encourage larger deposits. One victim from Tennessee lost significant money after being tricked into paying extra tax or verification fees when attempting to withdraw funds. The withdrawals never occurred because the platforms were fake and stolen assets had already been moved through intermediary wallets.
The fraud network transferred stolen funds across multiple Ethereum wallets to hide their source. However, investigators used blockchain analysis to link the assets to a specific wallet. The U.S. Department of Justice confirmed the USDT is subject to forfeiture under federal law as proceeds of wire fraud and money laundering. Tether worked with authorities to freeze the tokens.
The complaint also emphasized the rise in cryptocurrency investment fraud. The FBI received over 41,000 complaints in 2024, with total losses of $5.8 billion. Additionally, the crypto industry experienced 207 hacking incidents in the first half of 2026, more than double the 85 hacks reported in the same period in 2025, according to TRM Labs. The second quarter of 2026 alone saw 126 incidents, reflecting increased vulnerabilities in DeFi protocols.
