A little while after Centre blacklisted 100,000 in USDC, Tether has now blacklisted 46 million Tether (USDT) in Ethereum addresses. The blacklisted 39 Ethereum addresses are worth over $46 million. 24 among them hold a total of more than 5.5 million USDT have been blacklisted in 2020.
The revelation comes on the back of Center’s first blacklisting affecting 100K USDC. Philippe Castonguay, an Ethereum researcher at Horizon Games, utilized Dune Analytics to create a dashboard that tracks the cumulative number of addresses blacklisted by Tether and Centre. The biggest address holds at least 4.5 million USDT and was just recently blacklisted on April 5.
Just like the blacklisted addresses that hold USDC, Tether addresses that got a blacklisting function cannot transact with Tether, and all existing coins held in the address were frozen. Stuart Hoegner, a general counsel at Bitfinex (a sister company of Tether), told reporters that Tether operates in conjunction with international law enforcement agencies and it blacklists addresses whenever needed:
“Tether routinely assists law enforcement in their investigations… Through the freeze address feature, Tether has been able to help users and exchanges; to save and recover tens of millions of dollars stolen from them by hackers.”
Arcane Assets CIO Eric Wall said on Twitter that the latest freeze happened on June 14 targeting an address that received 939,000 USDT from Binance about 22 hours before the blacklisting occurred. Apart from that, Eric added that most other freezes were primarily precautionary actions:
“Most other freezes seem to have been made on Ethereum accounts either for precautionary reasons (possibly identified as scams/Ponzis); or in error/to protect others from making errors (like freezing 0x000…0001). 3 addresses were unfrozen after the freeze.”
The recent development further adds to the distrust of the central organizations that exist within the crypto world. Also, there is a resistance particularly over the stablecoins and their ability to be censored. One of the users commented on Castonguay’s Twitter post that mentioned that sUSD and Dai (DAI) are the only censorship-resistant stablecoins.