Tether announces wallet-freezing policy for OFAC-sanctioned persons

 In an attempt to work with US regulators, Tether is extending control measures to the secondary market.

According to a blog post published on December 9, stablecoin issuer Tether has indicated that it is taking a voluntary approach to freezing wallets, marking another step toward cooperation with law enforcement and regulatory bodies. 

Tether has been providing secondary market restrictions to stop transactions involving sanctioned individuals on the Specially Designated Nationals (SDN) List maintained by the US Office of Foreign Assets Control (OFAC) since December 1. The list includes organizations and people that are under the ownership or control of sanctioned nations.

Tether claims that the policy is a "proactive effort to work even more closely with global regulators and law enforcement agencies" and will enhance current security procedures.

Tether Introduces New Policy to Strengthen Ecosystem Security

Read more ⬇️https://t.co/kCCFhLflfb

— Tether (@Tether_to) December 9, 2023

 The list has been used by the US Department of Treasury to stop cryptocurrency transactions that might be linked to criminal activity, such as financing terrorism and the unapproved sale of fentanyl.

Tether has already frozen wallets that were previously included to the SDN List, which goes against the company's prior stances on the subject. For instance, Tether declared in August 2022 that it will not proactively freeze authorized Tornado Cash addresses unless directed to do so by law enforcement. Since 2019, the OFAC claims that people and criminal groups have laundered over $7 billion in bitcoin using Tornado Cash.

“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,” said Paolo Ardoino, CEO of Tether.

Paolo Ardoino, CEO of Tether, stated, "We will be able to further strengthen the positive usage of stablecoin technology and promote a safer stablecoin ecosystem for all users by executing voluntary wallet address freezing of new additions to the SDN List and freezing previously added addresses."