Tether Freezes Over $150M+ Worth Of USDT Stablecoin
January 13 2022 - 9:54PM
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Tether has been one of the biggest question marks in crypto in
recent years, and that hasn’t changed as adoption has grown.
Decentralization has been a hot topic, and while the word itself
isn’t mentioned once throughout Satoshi Nakamoto’s Bitcoin
whitepaper, it is a core identity that has been latched on to
bitcoin, and crypto in general, since near inception. Of course,
decentralization is the core component of just one of many question
marks around Tether. However, this week the spotlight is on just
that, as Tether announced that roughly $160M worth of stablecoin
USDT would be frozen. Let’s look at what we know. Tether Faces
Scrutiny Around Decentralization Three Ethereum-based USDT
addresses, holding north of $150M, were frozen this week, according
to Tether officials, as the blockchain cited the move due to “a
request from law enforcement.” The blockchain has now blacklisted
over 560 addresses since November 2017. It was the first
blacklisting maneuver from Tether in 2022. Tether representatives
have previously stated that “through the freezing of addresses,
Tether has been able to help recover funds stolen by hackers or are
compromised,” leading to heated debates in the crypto community –
one that has largely embraced decentralization – over what degree
of power blockchain authorities should be able to weild over the
network. Long-time crypto loyalists are, generally speaking, not
ecstatic about Tether’s level of control of the market – even if
the end result is to replace funds that were lost due to the
actions of malicious bad actors. Furthermore, recent U.S.
government scrutiny over the likes of stablecoins – notably USDT
and USDC – have arguably led to substantial growth of more
decentralized alternatives, namely UST and DAI – the third and
fourth largest stablecoins in the market. Related Reading | Jack
Dorsey’s Block Looking To Democratize Bitcoin Mining With Open
Source Mining System As broader cryptocurrency markets have grown,
so too have stablecoins such as USDT; however increased scrutiny
from crypto loyalists have left many wondering about the extent of
power that the network should carry. | Source: CRYPTOCAP: USDT on
TradingView.com Where We Go From Here Admittedly, Tether is
undoubtedly in between a bit of a rock and a hard place. The
leading stablecoin is rapidly approaching a $100B market cap, and
is salivating at the thought of solidifying it’s stature as the
‘go-to’ stablecoin in a world of rapid crypto growth. Additionally,
according to a Chainalysis report, illicit activity and
cryptocurrency-based crime nearly doubled in 2021 compared to 2020,
and government officials are likely ramping up communications with
the blockchain. As we kick off the new year, expect more of the
same when it comes to Tether, and perhaps even Circle’s USDC – as
the two look to ingrain crypto in more mainstream outlets, a degree
of centralization to come with that is inevitable. Related Reading
| UAE Authorities Announce New Stringent Measures Against Crypto
Scammers Featured image from Pexels, Charts from TradingView.com
The writer of this content is not associated or affiliated with any
of the parties mentioned in this article. This is not financial
advice.
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