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madartzgraphics (CC0), Pixabay

According to on-chain data, it appears that the stablecoin issuer known as Tether froze a particular user’s account, locking over a million dollars. This is because $1 million is too much money to be kept in only one wallet. On December 30, 2021, Tether used the “AddedBlacklist” feature to block the address within a specific transaction.

Once an address gets blacklisted, it’s no longer possible for the wallet owner to move any funds stored inside. In this case, the address can no longer move the USDT balance.

Tether Works Alongside Law Enforcers

However, the address owner remains anonymous, as the spokesperson who discussed the case didn’t reveal the owner’s identity. The spokesperson did reveal that Tether has been working hand-in-hand with regulators and law enforcement agencies across the globe to freeze accounts, especially when it’s related to hacks and scams.

The spokesperson also mentioned that the stablecoin issuer has helped recover compromised or hacked funds thanks to Tether freezing these addresses. Tether has been blocking addresses since 2017 and has since blocked more than 500 addresses.

Tether also has a “recovery” mechanism feature, which allows the network to freeze or reissue USDT depending on the circumstances. For instance, if you happen to send funds to the wrong address, the issuer can assist you in recovering those funds by freezing the USDT transferred to the wrong account and reissuing new funds to the user so they can send them to the correct address.

However, Tether blocked the address containing the $1 million in this case. This means that the frozen address is currently under dispute or investigation by law enforcers. This isn’t the first time Tether similarly froze an account, either. A couple of years ago, Tether froze about 39 Ethereum addresses. Those addresses were worth $46 million in USDT, while 24 of those addresses held over 5.5 million USDT in total.

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