DOJ Seizes $9 Million Tether (USDT) Linked to Pig Butchering Scam

The U.S. Department of Justice (DOJ) has seized $9 million worth of Tether (USDT) stablecoin linked to a "pig butchering" scam.

In a significant development that underscores the evolving battle between law enforcement and cybercriminals in the cryptocurrency space, the U.S. Department of Justice (DOJ) has seized $9 million worth of Tether (USDT) stablecoin linked to an organization operating a notorious "pig butchering" scam. Agents and analysts from the U.S. Secret Service employed advanced techniques to trace victim deposits laundered through various cryptocurrencies, a practice termed "chain hopping." This successful seizure comes as Tether collaboratively worked with the DOJ and cryptocurrency exchange OKX to freeze $225 million worth of its stablecoin, marking a pivotal moment in the fight against cryptocurrency-related crimes.

In related news, amidst the cryptocurrency market's tumultuous ride in 2023, Tether, the largest stablecoin by market value, has emerged as a remarkable success story. This year, Tether has shattered records, witnessing a staggering surge in market capitalization of at least $20 billion. Data from blockchain data provider Whale Alert reveals that Tether minted a substantial 22.75 billion USDT tokens in 2023, with 4 billion USDT issued in just the last four weeks.

U.S. Department of Justice Seizes $9 Million in Tether (USDT) Linked to Pig Butchering Scam

In a significant development in the world of cryptocurrency, the U.S. Department of Justice (DOJ) has successfully seized $9 million worth of Tether (USDT) stablecoin connected to an organization involved in a notorious "pig butchering" scam. The seizure comes as a result of a meticulous investigation conducted by agents and analysts from the U.S. Secret Service, who traced victim deposits that had been laundered through various cryptocurrencies using a technique the DOJ has termed "chain hopping."

Tether, one of the largest stablecoin issuers globally, took proactive measures in collaboration with the DOJ and cryptocurrency exchange OKX, leading to the freezing of $225 million worth of its stablecoin on the preceding Monday. This cooperative effort marks a significant milestone in combating cryptocurrency-related crimes and protecting innocent victims who have fallen prey to fraudulent schemes.

The "pig butchering" scam, so named due to its insidious nature, typically involves perpetrators luring victims through traditional romance scams. Victims are often led to believe they are forming genuine romantic connections with individuals they meet online. As trust builds, the scammers then request victims to send cryptocurrencies overseas, under the guise of various false narratives such as financial difficulties or emergencies.

The success of this latest seizure highlights the growing determination of law enforcement agencies to tackle cryptocurrency-related crimes and bring those responsible to justice. In recent years, the cryptocurrency space has attracted cybercriminals seeking to exploit its relative anonymity and ease of cross-border transactions for their illicit activities.

The DOJ's statement on Tuesday emphasized the significance of this seizure as a powerful deterrent to would-be cybercriminals. It sends a clear message that despite the perception that the cryptocurrency ecosystem provides a secure haven for laundering ill-gotten gains, law enforcement agencies are continually enhancing their capabilities to trace and recover these funds for the benefit of victims.

"This seizure should also serve as a reminder to cybercriminals that, although the current landscape of the cryptocurrency ecosystem may seem like an ideal way to launder ill-gotten gains, law enforcement will continue to develop the expertise needed to follow the money and seize it back for victims," the DOJ warned in its official statement.

The ongoing collaboration between government agencies, cryptocurrency exchanges, and blockchain companies is indicative of a growing commitment to ensuring the security and integrity of the cryptocurrency space. By working together to identify and dismantle fraudulent schemes, such as the "pig butchering" scam, authorities hope to instill confidence in the cryptocurrency ecosystem and encourage responsible use.

Cryptocurrency exchanges, in particular, play a crucial role in preventing such scams by implementing stringent know-your-customer (KYC) and anti-money laundering (AML) measures. These measures help identify suspicious transactions and individuals involved in criminal activities, ultimately aiding law enforcement in their efforts to bring wrongdoers to justice.

As the cryptocurrency landscape continues to evolve, it is clear that regulatory and law enforcement agencies are adapting in tandem, determined to protect both the integrity of the digital asset ecosystem and the interests of innocent victims. The seizure of $9 million worth of Tether connected to the "pig butchering" scam represents a significant victory in this ongoing battle against cybercrime in the cryptocurrency space.

Tether's Soaring Success: $20 Billion Surge in Market Cap in 2023

In a year marked by turbulence and uncertainty in the cryptocurrency market, Tether, the largest stablecoin by market value, has emerged as a beacon of stability and growth, smashing records as its market capitalization surged by at least $20 billion in 2023.

Data provided by blockchain analytics firm Whale Alert reveals that Tether has minted a staggering 22.75 billion USDT tokens in the course of this year alone, with a remarkable 4 billion USDT being issued in just the past four weeks.

Starting the year with a market cap of approximately $66 billion, Tether's ascent has been relentless, steadily gaining momentum. By April 2023, the market value of Tether's USDT had already eclipsed the $80 billion mark. Remarkably, on Nov. 14, the USDT market cap momentarily reached a peak of $87 billion, as per CoinGecko data.

Tether's unprecedented growth can be attributed to several key factors, according to a spokesperson for the stablecoin issuer. One of the primary drivers has been the persistent market enthusiasm surrounding the potential approval of a spot Bitcoin exchange-traded fund (ETF). Institutional investors have been increasingly drawn to Bitcoin, anticipating the groundbreaking impact of a Bitcoin ETF's launch.

A representative from Tether commented on this phenomenon, saying, "There is a growing interest in Bitcoin from institutional investors, driven by the excitement around the possibility of a Bitcoin ETF."

In addition to the anticipation surrounding a Bitcoin ETF, Tether's remarkable success story has been fueled by surging demand in emerging markets. The stablecoin has cemented itself as the de-facto digital dollar for emerging economies and developing nations. The spokesperson elaborated on this point, stating:

"There are, in fact, many countries suffering from the devaluation of their national currencies compared to the dollar, hence all the communities living in those countries are seeking protection [...] USDT is the most trusted asset for them."

Highlighting Tether's dominance in this space, the stablecoin accounts for a staggering 80% of all cryptocurrency transactions in Brazil, according to public data from the Brazilian government. The Tether representative asserted that this pattern mirrors the situation in numerous other countries.

While Tether's meteoric rise has been the standout story of the year, other major stablecoins have struggled to maintain their footing in 2023. Circle's USD Coin (USDC), for instance, reached a peak market capitalization of $55 billion in June 2022. However, it has experienced a gradual decline throughout 2023, shedding a substantial $20 billion in market value, equivalent to a 45% drop since January 2023. As of the time of writing, USDC's market cap stands at $24 billion, according to CoinGecko.

Market Cap Overview

Daily chart for the USDT market cap (Source: TradingView)

USDT’s market cap stood at around $88.075 billion at press time. TradingView data indicated that the stablecoin’s market cap had risen more than 1% throughout the past 2 weeks. Notably, USDT’s market cap soared to a high of $90.513 billion on Nov. 8, but quickly dropped back down to close the daily candle off at $86.288 billion.