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<p class="is-style-lead">Tether Holdings Limited, the Hong Kong-based company and the issuer of USDT, the world&#8217;s largest stablecoin by circulating supply, has frozen an account holding over $4.1 million of the token on Ethereum, on-chain data on June 19 reveals.</p>



<h2 class="wp-block-heading" id="tether-freezes-4-1-million-of-usdt-on-ethereum">Tether freezes $4.1 million of USDT on Ethereum</h2>



<p>Tether froze $4.11 million of USDT on June 19 without explaining, records captured by WhaleAlert on the same day&nbsp;<a href="https://whale-alert.io/transaction/ethereum/0x2f93f8c9e48a81cfa6c23532c329fb99d633be3c97fccfbea1bc152095498db4" target="_blank" rel="noopener">reveal</a>.</p>




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<p>On Etherscan, an analytics platform for tracking ethereum (<a href="https://crypto.news/price/ethereum/">ETH</a>) and Ethereum-based tokens, records <a href="https://etherscan.io/address/0x3fdee67c0c22b04628c6ca687b356d3b4975efba" target="_blank" rel="noopener">show</a> that the USDT issuer had marked the wallet as frozen. At the same time, the associated address had four tokens in total. Besides the USDT, other assets were labeled as &#8220;suspicious.&#8221;</p>



<p>It could not be immediately verified where the funds were from and why the USDT issuer decided to freeze the account.&nbsp;</p>



<p>On Reddit, a user observed that the frozen account belonged to a Huobi user. Most of this Tether was funneled in March 2023, and, in his speculation, the owner might be involved in suspicious activities. As a result, the USDT issuer swooped in and froze the address&#8217; holdings.</p>



<p>Tether Holdings Limited is a centralized entity and the official issuer of USDT. As of June 19, there was over $83.1 billion worth of USDT in circulating supply.&nbsp;</p>



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<p>Theoretically, each token in circulation in any blockchain or layer-2 platforms USDT is issued on is backed 1:1 with cash or cash equivalents. In this way, each USDT in circulation can be redeemed for a USD.&nbsp;</p>



<p>For their offering, USDT plays a critical role in cryptocurrency, allowing the flow of capital from and to traditional finance while allowing holders to engage in other activities, including decentralized finance (DeFi).</p>



<h2 class="wp-block-heading" id="centralization-concerns">Centralization concerns</h2>



<p>Despite what USDT brings to the crypto table, the issuer&#8217;s ability to freeze assets is against the core principles espoused by the blockchain. Technically, cryptocurrencies are supposed to be borderless and censorship-resistant.&nbsp;</p>



<p>Some people have criticized Tether Holdings Limited for freezing the address. On Reddit, a social media platform, one user <a href="https://www.reddit.com/r/CryptoCurrency/comments/14ddowf/an_address_with_a_balance_of_4118579_usdt_4120536/" target="_blank" rel="noreferrer noopener">said</a> Tether acts like a bank and can freeze USDT on any chain the token is in circulation if ordered by law enforcement. </p>



<p>Another pointed out that the issuer has integrated a kill switch in the token&#8217;s code and can, at any point, block an address.</p>




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USDT issuer freezes Ethereum address with over $4.1m

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