Tether Freezes $4.2B in USDT Linked to Criminal Activity

By Hanan Zuhry LinkedInFebruary 28, 2026 · 2 Min

Tether freezes $4.2 billion in USDT tied to criminal activity, reinforcing its commitment to compliance and user security.

Tether Freezes $4.2B in USDT Linked to Criminal Activity

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Quick Take

Summary is AI generated, newsroom reviewed.

Tether froze about $4.2 billion in USDT tied to illegal activities, including $3.5 billion since 2023.
The freeze helped the U.S. Department of Justice combat scams such as “pig-butchering” frauds.
CEO Paolo Ardoino emphasized Tether’s cooperation with regulators and efforts to maintain stablecoin security.
The frozen funds represent 2.3% of USDT’s $180 billion circulating supply, demonstrating active compliance measures.

Tether has frozen about $4.2 billion in USDT linked to illegal activity, according to Reuters. Around $3.5 billion of that total has been frozen since 2023. The move shows Tether’s active role in fighting crypto-related crime.

🚨NEW: TETHER FREEZES $4.2B IN USDT LINKED TO ILLICIT ACTIVITY

Tether has frozen roughly $4.2 billion in $USDT tied to criminal cases, @Reuters reports.

About $3.5 billion of that total has been frozen since 2023.

This week, the company assisted the U.S. Department of Justice.… pic.twitter.com/J2SnRMu8kz
— BSCN (@BSCNews) February 28, 2026

Tether Freezes Billions to Fight Fraud

The frozen funds account for roughly 2.3% of USDT’s $180 billion circulating supply. While Tether has worked closely with the U.S. Department of Justice to target scams.

One example is “pig-butchering” frauds, where criminals trick victims into sending money with fake investment promises. This week, about $61 million in USDT linked to such scams was blocked. Therefore, by taking these steps, Tether aims to protect users and maintain trust in its stablecoin.

Tether Works With Law Enforcement

CEO Paolo Ardoino stressed Tether’s commitment to cooperating with regulators. The company shared a video highlighting the frozen funds alongside his image.

This visual emphasizes the company’s compliance and reinforces its anti-fraud message. Moreover, the collaboration shows how stablecoin issuers can work with authorities to prevent criminal activity.

Effects on USDT and Investors

The freeze did not significantly impact USDT’s market stability. Analysts note that it may even boost confidence among investors.

High-volume traders and institutions could view Tether’s actions as a sign of reliability. Meanwhile, casual users see that the network actively prevents misuse. This move also highlights the importance of transparency and security in the stablecoin ecosystem.

Tether Highlights Compliance and Security

Tether’s recent actions underline the growing focus on regulatory compliance in crypto. As authorities continue to investigate fraud, issuers face more scrutiny.

For users and investors, these proactive steps demonstrate that the platform can stop criminal activity without affecting token functionality. This freeze helps protect the market while maintaining USDT’s role as a widely used stablecoin. This response shows that stablecoin issuers can balance compliance, security and accessibility for all users.