Tether has revealed it helped US authorities freeze $344 million worth of USDT held in two Tron wallets after receiving a request from the Office of Foreign Assets Control (OFAC) and US law enforcement. In a disclosure on Thursday, the stablecoin issuer said the wallets were flagged by authorities as linked to sanctions evasion, criminal networks or other illicit activity, prompting the freeze.
Tether framed the action as part of its routine cooperation with law enforcement worldwide. The company said it works with more than 340 agencies across 65 countries and that its collaboration has supported over 2,300 cases globally — including more than 1,200 tied to US authorities. According to Tether, these joint efforts have contributed to freezing over $4.4 billion in assets, with more than $2.1 billion linked to US investigations.
CEO Paolo Ardoino underscored the company’s stance: USDT is not a “safe haven” for illicit actors. He said that when Tether identifies credible links to sanctioned entities or criminal organizations, the firm moves “quickly and decisively” to comply with lawful requests.
The disclosure comes amid heightened scrutiny of stablecoin issuers — particularly Circle, which issues USDC. Critics have accused Circle of failing to act promptly in several high-profile thefts and hacks, allowing attackers to shift large sums across blockchains. That criticism intensified after the early-April Drift Protocol exploit and has now surfaced in litigation: a Massachusetts lawsuit linked to the $280 million Drift hack alleges Circle did not freeze stolen funds despite having the technical means and contractual authority to do so. The complaint claims attackers moved up to $230 million to the Ethereum blockchain by using Circle’s Cross-Chain Transfer Protocol (CCTP), and that Circle’s alleged inaction enabled those transfers.
While Circle faces those accusations, Tether announced a strategic collaboration with Drift Protocol intended to aid user recovery and support a relaunch of the platform. Tether said the initiative includes a structured recovery plan backed by nearly $150 million in combined support — up to $127.5 million of which would come from Tether itself.
The episode highlights growing expectations that stablecoin issuers play an active role in preventing and responding to illicit activity, and underscores the regulatory and legal pressures shaping how issuers balance decentralization with compliance.
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