US Uses Tether to Freeze Iran’s $500 Million

Tether, the company that creates a dollar‑linked digital coin called USDT, has become a tool for U. S. sanctions against Iran. In less than three months, the U. S. government has frozen almost $475 million that was tied to Iran on the Tron blockchain, pushing its reach beyond banks. On July 14, U. S. authorities seized four Tron wallets that held about $131 million in USDT. Those addresses belong to Iran’s Central Bank, known as Bank Markazi. Treasury Secretary Scott Bessent said the Office of Foreign Assets Control (OFAC) targeted them to cut off money Iran allegedly uses to dodge sanctions. The U. S. will keep tracking and blocking those funds. This move comes as tensions rise over the Strait of Hormuz. The U. S. Central Command said it would re‑impose limits on ships going in and out of Iranian ports starting July 14, after recent U. S. strikes on Iranian military sites. Earlier in April, Tether froze more than $344 million in two other Tron wallets after working with OFAC and law enforcement. Together, these actions have immobilized about $475 million linked to Iran, showing how Tether’s control of USDT can stop money from moving even though the wallet still shows a balance on the public ledger. The freeze is part of a broader U. S. effort called Operation Economic Fury, which targets crypto exchanges and blockchain addresses that help Iran move dollars outside the traditional banking system. In June, OFAC sanctioned four Iranian crypto exchanges—Nobitex, Bitpin, Ramzinex, and Wallex—for handling a large share of Iran’s digital‑asset traffic. These sanctions show that Washington is no longer just watching transactions after they happen; it is also shutting down the platforms that convert local money into crypto.

Iran’s crypto market is huge, with Chainalysis estimating $7. 78 billion in activity in 2025 alone. Half of that comes from addresses linked to Iran’s Islamic Revolutionary Guard Corps, which received more than $3 billion last year. By late May, U. S. officials had frozen almost $1 billion in Iranian crypto assets through the wider campaign. What makes USDT special is that Tether, as the issuer, can block an address by blacklisting it. Unlike Bitcoin, where anyone holding a private key can move coins freely, Tether can stop USDT from being transferred while still showing the balance. In some cases, it can even cancel tokens at one address and issue new ones elsewhere, giving law enforcement a way to take control of the value. Tether has long said it uses these controls to comply with sanctions, seizure warrants, and anti‑money‑laundering rules. Since December 2023, it has agreed to disable tokens in wallets on OFAC’s sanctions list and work with U. S. agencies like the Secret Service and FBI. Earlier this year, Tether said it collaborates with over 340 law‑enforcement groups in 65 countries, helping to freeze more than $4. 4 billion across cases. The company’s shift toward cooperation has come after years of scrutiny over its reserves. In 2021, Tether paid $41 million to settle allegations that it misrepresented its backing. Now, with about $184 billion of USDT in circulation, Tether operates a dollar‑like asset used worldwide for trading, payments, and informal finance.

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