Stablecoin issuer Tether has announced another step towards cooperation with regulatory and law enforcement agencies by starting a voluntary wallet freezing policy, according to a Dec. 9 blog post.
Since December 1, Tether has been offering controls on the secondary market to freeze activity related to sanctioned individuals on the United States Office of Foreign Assets Control's (OFAC) List of Specially Designated Nationals (SDN). The list includes companies and individuals controlled or owned by sanctioned countries.
According to Tether, the policy will complement existing security protocols and is a "proactive effort to work even more closely with global regulators and law enforcement agencies."
Tether presents new policy to strengthen ecosystem security
Read more โฌ๏ธhttps://t.co/kCCFhLflfb
- Tether (@Tether_to) December 9, 2023
The US Treasury Department has been using the list to potentially curb crypto transactions. related to illegal activitiesincluding terrorist financing and unauthorized distribution of fentanyl.
Tether has already frozen wallets previously added to the SDN List, a move that contradicts the company's previous positions on the matter. In August 2022, for example, Tether announced that it would not proactively freeze Tornado Cash addresses sanctioned unless instructed to do so by police. According to OFAC, individuals and criminal organizations I have used Tornado Cash to launder more than $7 billion in cryptocurrencies since 2019.
"By executing the voluntary freezing of wallet addresses of new additions to the SDN List and the freezing of previously added addresses, we will be able to further strengthen the positive use of stablecoin technology and promote a more secure stablecoin ecosystem for all users," said Paolo Ardoino, CEO of Atar.
The Hong Kong-based company is behind the Tether stablecoin (USDT), whose market capitalization reached all-time highs during the crackdown on crypto companies in the US over the past few months. Currently, its market capitalization is $90 billion, indicating strong demand for the stablecoin that holds almost 70% of the market.
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