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Tether freezes $45 million in USDT tied to sanctioned Xinbi network
Blockchain analytics firm Bitrace says the freezes spanned at least 22 operational addresses and quickly hit newly activated replacement wallets, stranding tens of thousands of USDT.
Tether has moved to freeze operational USDT wallets linked to Xinbi Guarantee as the sanctioned Xinbi marketplace tries to maintain the ability to transact, according to CryptoSlate. Blockchain analytics firm Bitrace said on Sept. 9 that more than $45 million in USDT had been frozen across at least 22 addresses tied to the network, including wallets used to receive, route, and withdraw funds.
The UK sanctioned Xinbi Guarantee in March, describing it as a major Chinese-language crypto marketplace and money-laundering hub serving Southeast Asian scam compounds. Bitrace said the breadth of Tether’s action targeted not only previously known holdings but also recently used deposit, intermediary, and withdrawal addresses, along with outgoing hot wallets operated by Xpay, and wallets of third parties with close financial ties to the marketplace.
Bitrace said Xinbi attempted to respond by activating new operational addresses, but replacements were frozen again on the evening of Sept. 8, less than 12 hours after the initial action. One replacement business address reportedly moved about 1.8 million USDT before another restriction was imposed, leaving about 37,839 USDT stranded.
CryptoSlate also highlighted that enforcement extended beyond wallets directly attributed to Xinbi, with third-party operators caught in the freezes. Bitrace cited one OTC operation that processed more than $72 million over the prior year and another whose deposits through Xinbi totaled less than $850,000, reflecting how Tether has incorporated freezing capability into law-enforcement efforts.