Tether Blocks $873K Connected To Terror Activities In Ukraine And Israel

On Monday, USDT issuer Tether announced the freezing of 32 crypto wallet addresses. These addresses together hold $873,118 and are believed to be associated with activities related to “terrorism and warfare” in Ukraine and Israel.

The freezing of these crypto wallet addresses underscores the growing importance of regulatory compliance and security in the cryptocurrency space.

Stablecoin issuers, in particular, are facing increasing pressure from governments and financial institutions to ensure that their digital assets are not used for illegal or harmful purposes.

This move also highlights the need for enhanced due diligence and monitoring of crypto transactions, as it can help detect and prevent potential misuse of digital currencies for nefarious activities.

No To Terror: Blocking USDT Accounts

The Israeli police recently disclosed that they have taken measures to freeze cryptocurrency accounts that were utilized for the purpose of soliciting donations for Hamas through various social media platforms. The strike conducted by the terror group on October 7 resulted in the loss of 1,300 lives in Israel.

The National Bureau for Counter Terror Financing of Israel has reportedly been working with Tether, the company behind the biggest stablecoin in the world, on their joint venture.

USDT market cap currently at $83.7 billion. Chart: TradingView.com

The CEO of Tether, Paolo Ardoino, emphasized that blockchain platforms make it simple to track cryptocurrency transactions, which allows Tether to help prevent the usage of USDT associated with funding terrorism.

Cryptocurrency primarily operates beyond the confines of the conventional financial system, and the use of wallet addresses with pseudonymous characteristics renders it challenging to trace the individuals responsible for transactions.

“Contrary to popular belief, cryptocurrency transactions are not anonymous; they are the most traceable and trackable assets,” Ardoino said.

In a blog post published in February, TRM Labs, a prominent blockchain analysis firm collaborating with law enforcement authorities, asserted that USDT has emerged as a preferred currency for facilitating terrorist financing.

Collaborative Efforts With Binance: Disrupting Terrorist Financing

In the latter part of 2022, Tether has implemented a freeze on assets totaling more than $360 million. The company later reissued a sum exceeding $100 million worth of USDT that had been previously intercepted.

In a broader context, these actions reflect a growing trend within the cryptocurrency space. Binance, another major player in the industry, has been actively collaborating with Israeli authorities to freeze cryptocurrency accounts associated with the Hamas group, thereby disrupting their financial resources critical for their operations.

Binance’s efforts also resulted in the seizure of 190 accounts linked to Islamic terrorist activities, underscoring the cryptocurrency sector’s commitment to addressing global security concerns and preventing the potential misuse of digital assets for illicit purposes.

Since Russia’s invasion last year, cryptocurrency has been widely used in Ukraine, with Kyiv raising more than $100 million in cryptocurrency after calling for donations. Pro-Russian militants have utilized cryptocurrency to raise funds in eastern Ukraine, according to blockchain researcher Chainalysis last year.

Featured image from Reuters