Renowned stablecoin issuer Tether has frozen $873,118 worth USDT in order to combat terror activities in Israel and Ukraine. Israel’s National Bureau for Counter Terror Financing collaborated with Tether in order to execute this bold step. It underscores the growing interdependence between global law enforcement agencies and crypto firms.
Paolo Ardoino, the new CEO of Tether praised blockchain for its transparency after blocking the funds. It will serve as a testament of the industry’s commitment to curb illegal financial activities.
“Contrary to popular belief, cryptocurrency transactions are not anonymous; they are the most traceable and trackable assets”
This move is a part of a greater initiative to help enforcement authorities globally combat movement of funds associated with terror organizations. Tether has frozen a total of $835 million in USDT linked to primarily hacks and security breaches.
Tether has partnered with 32 countries globally to address illegal activities linked to its dollar-backed stablecoin.
Israel blocks terror linked crypto wallets
Just this month, Yoav Gallant, Israel’s defense minister announced that they seized crypto wallets with millions of dollars owned by Lebanese militant group Hezbollah. Chainalysis tools helped authorities in this operation. It allowed them to seize over $1.7 million in cryptocurrency.
Criminals have increasingly switched from Bitcoin to transfer money. They now prefer stablecoins, which are safe from price fluctuations and altcoins which are either less volatile or under the radar.
Such digital currencies offer the ability to be laundered through decentralized exchanges and accessibility.
Israeli officials have already seized nearly 190 crypto wallets on Binance related to Hamas because they were using them for fundraising and other unlawful activities, according to a report by Todayq News on May 5, 2023.
Cryptocurrencies are largely used by these terrorist groups as a strong fundraising tool, which makes it difficult for the government to track and monitor them. Crossing international borders with physical cash is risky and noticeable. This situation makes it more important than ever for financial transaction regulation and oversight to work together more closely. It also raises questions about the effectiveness of sanctions.
The local crypto community has launched the “Crypto Aid Israel” as the war situation in Israel intensifies. This initiative is setting up a multi-signature wallet that accepts cryptocurrency donations ranging from Bitcoin, Ethereum, USDT, and USDC. It will provide assistance in times of crisis,
Blockchain’s anonymity fades
This action by Tether serves as a good example that blockchain’s anonymity is diminishing. This was bound to happen since the technology is open to use for people involved in illegal activities.
However, it is clear that the crypto industry acknowledges that blockchain’s ability to keep someone anonymous is being misused. The industry is ready to work with the enforcement authorities to maintain transparency and security.
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