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Saturday, February 24, 2024

Tether Takes Swift Action: Freezes $225 Million Allegedly Tied to Human Trafficking

Crypto company Tether announced on Monday that it has frozen $225 million worth of its coin, citing connections to a Southeast Asian human trafficking organization.

The U.S. Secret Service requested that Tether freeze the tokens as part of a ‘months-long investigative effort’ involving Tether and the cryptocurrency exchange OKX, as stated in a blog post by the company. However, Tether did not provide specifics regarding the extent or duration of the probe. When Reuters reached out to the Secret Service for comment, they did not reply immediately. Without offering further details, Tether mentioned that OKX and they worked together with the US Department of Justice (DOJ) on the investigation.

 

A representative from the Department of Justice did not promptly reply to inquiries seeking comments. According to Tether, the cryptocurrency tokens were ‘connected to a global ‘pig slaughtering’ romance scam orchestrated by an international human trafficking syndicate in Southeast Asia.’ The phrase ‘pig butchering’ typically describes situations in which a con artist gains the trust of their victims using messaging services, social media, and dating apps, then coerces them into making investments in fraudulent cryptocurrency or online trading schemes. Tether withheld information on the group’s activities and bitcoin usage.

As per Tether, this was the biggest token freeze in the company’s history. According to a study released by the United Nations in August, criminal gangs in Southeast Asia are enticing hundreds of thousands of individuals to labor in fraud centers and other illicit online businesses.

Tether is classified as a stablecoin, with its value tied to the U.S. dollar. With $87.9 billion worth of tether tokens in circulation, it stands as the third-largest cryptocurrency, following bitcoin and ether, according to CoinGecko’s information.

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