Tether Freezes $29.6 Million in USDT Linked to Money Laundering Scheme
A wallet containing $29.6 million in USDT has been frozen by Tether, a leading stablecoin issuer, after it was linked to a money laundering scheme tied to the Lazarus Group, a notorious hacker organization associated with the North Korean government.
Funds Stem from DMM Bitcoin Hack
According to analyst ZachXBT, the funds in the frozen wallet are connected to the hacking of the Japanese cryptocurrency platform DMM Bitcoin, which resulted in the theft of at least $14 million. The hacked funds were allegedly laundered through Huione Guarantee, a Cambodian exchange known for its role in legitimizing funds from criminal activities.
Lazarus Group’s Money Laundering Route
ZachXBT’s report details the money laundering route used by Lazarus Group, which involves:
- Depositing Bitcoin stolen from DMM Bitcoin into a mixer
- Withdrawing Bitcoin from the mixer
- Bridging Bitcoin funds to Ethereum or Avalanche via THORChain, Threshold, and Avalanche bridge
- Swapping Bitcoin for USDT and bridging to Tron via SWFT
- Transferring USDT to Huione Guarantee
Tether’s Approach
Tether has been actively working with authorities to prevent the use of USDT in criminal activities. The company’s move to freeze the funds in the affected wallet is part of its efforts to curb illegal activities and support investigations.
Tether has a blacklist of wallets linked to criminal activities, and the frozen funds will not be able to be moved or used. The company has collaborated with various security agencies to investigate and cut off paths to those responsible for using USDT linked to theft and fraud.
Tether’s Regulatory Compliance
Tether has taken steps to comply with regulatory rulings, including blocking addresses listed on the Office of Foreign Assets Control (OFAC) blacklist and freezing wallets involved in large-scale attacks.
