Will your USDT be frozen by Tether if you receive illicit funds or are targeted by regulatory authorities?

The answer is: Yes.

Data shows that in 2024-2025, Tether has already frozen thousands of wallet addresses, involving amounts totaling billions of dollars.

Many people don't realize that USDT is a centralized stablecoin (including USDC), which is completely different from decentralized tokens. Tether has absolute control.

Regardless of whether your tokens are on Ethereum, BSC, or other chains, Tether can freeze your USDT through a "blacklist" mechanism. Although the frozen USDT remains in your account, you cannot transfer or trade it.

However, there's no need to be overly concerned. Tether does not freeze user assets arbitrarily. Typically, assets are only frozen under the following circumstances: law enforcement requests, international sanctions, hacking and theft, or regulatory violations.

If the freeze is due to a violation, you can contact Tether customer support for assistance. However, if you are targeted by law enforcement for money laundering or fraud, it is basically impossible to unfreeze the assets. Most of the frozen USDT in such cases will be destroyed or confiscated by law enforcement.