Stablecoin issuing company Tether has announced a new security policy aimed at protecting the crypto ecosystem from bad actors. In addition, the USDT issuer is looking to enhance its cooperation and relationship with law enforcement agencies.
Tether Freezes 41 New Wallets Following New Security Policy
In a blog post on December 9, Tether stated it would be introducing a voluntary wallet-freezing initiative designed to counter the transactions associated with Sanctioned Persons on the Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List.
According to Tether, the company currently has a wallet-freezing policy, but it is only applicable to wallets on its platform. Moving forward, the stablecoin issuer now offers its sanctions control on the secondary market, as it aims to improve its collaboration with governmental agencies in ensuring the safe use of stablecoins.
Interestingly, Tether’s latest policy is in direct opposition to its stance in 2022 when it stated it would not willingly restrict sanctioned Tornado cash addresses, barring a direct order from security agencies. With its announcement, the stablecoin issuer has now begun implementation of its new policy and ordered a wallet-freeze of all 41 wallets associated with persons and companies on the OFAC-SDN list.
Commenting on this development, Pablo Ardonio has expressed much excitement towards user safety and forming stronger ties with regulators worldwide.
He said:
This strategic decision aligns with our unwavering commitment to maintaining the highest standards of safety for our global ecosystem and expanding our close working relationship with global law enforcement and regulators. By executing voluntary wallet address freezing of new additions to the SDN List and freezing previously added addresses, we will be able to further strengthen the positive usage of stablecoin technology and promote a safer stablecoin ecosystem for all users.
Meanwhile, some crypto enthusiasts have welcomed this development as they believe it could exert some positive effect on stablecoin adoption in terms of regulations and general usage.
Breaking: @Tether_to public statement to comply with regulators demand to have freezable wallets for security. This is bullish meaning @Tether_to and the US government are working together, this will bring in the US Stable Coin Act and global adoption.#Tether#USDT… pic.twitter.com/E0eCC1skxf
— MartyParty (@martypartymusic) December 9, 2023
Mystery USDT Transaction
In other news, the Tether Treasury transferred $60 million worth of USDT to a “mysterious fund/institution” on December 8.
This development was revealed by blockchain analytics firm Lookonchain, which also stated that Tether had transferred a total of $1.76 billion USDT to this fund/institution since October 20, which has been further dispersed to other exchanges.
Being the issuer of the world’s largest stablecoin, large-scale transactions of this size are bound to draw attention to Tether due to its importance in the crypto ecosystem.
At the time of writing, USDT maintains its spectacular performance in 2023, having attained a $90 billion market cap value. This value represents over 70% dominance in the stablecoin market.
Total crypto market cap valued at $1.592 trillion on the daily chart | Source: TOTAL chart on Tradingview.com