Tether, the powerhouse behind the world's largest stablecoin, has decided to freeze coins held in crypto wallets sanctioned by the U.S. Office of Foreign Asset Controls (OFAC), marking a significant move announced today.
Voluntary Precautionary Step
In a strategic and proactive effort, Tether has chosen to freeze the wallets of individuals sanctioned by the OFAC. The company frames this action as a voluntary step aimed at "proactively preventing any potential misuse of Tether tokens and enhancing security measures." Importantly, Tether clarifies that this freezing extends to existing wallets on the OFAC list as well as any new wallets added in the future.
Leadership Change and Global Cooperation
This move coincides with one of the first significant actions under the leadership of Tether's new CEO, Paolo Ardoino, who recently assumed the role this month. Ardoino emphasized the new policy as a means of "expanding our close working relationship with global law enforcement and regulators" in the company's official press release.
Shift in Approach: Tether and Unlawful Activity
While Tether has previously frozen funds linked to illicit activities, it has shown reluctance in freezing wallets associated with the sanctioned Tornado Cash protocol. The company argued that it had not received any requests from U.S. law enforcement to take such action. However, in light of today's announcement, blockchain records reveal that Tether has blacklisted the contract addresses associated with Tornado Cash, signaling a shift in its stance on freezing assets related to sanctioned protocols.
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