In order to win the favor of regulatory authorities, Tether froze 29.62 million USDT from Cambodian fraud group Huione Group

Tether has frozen 29.62 million USDT tokens connected to criminal activities involving the Cambodian Huione Group, demonstrating its commitment to maintaining the integrity of its stablecoin amid increased regulatory scrutiny.

The frozen tokens were in a wallet identified as “TNVaKW,” which Bitrace, a blockchain security firm, linked to Huione Group’s potential fund laundering for fraud and crypto theft.

The wallet was frozen shortly after activation on July 9, 2024.

Huione Group continues to trade

Despite the freeze, Huione Group continues to transact using USDC stablecoins.

Bitrace revealed that Huione transferred 114,800 USDC to a new TQuFSv address following the freeze.

Other business addresses, such as TL8TBp, remain operational and involved in guarantee and payment services.

Huione Group’s Activities

Huione Group, part of a Cambodian conglomerate associated with the ruling Hun family, operates the Huione Guarantee platform, a popular marketplace for scam operators.

Since 2021, transactions involving Tether’s USDT on this platform have totaled over $11 billion, many suspected to be linked to fraudulent activities.

Tether’s Stance Against Misuse

Tether’s decision to freeze these tokens aligns with its proactive stance against the misuse of its assets. Recently, Tether has frozen significant amounts of USDT tied to various illicit activities, including phishing scams and human trafficking.

Despite these efforts, Tether continues to face scrutiny and allegations of regulatory investigations.

Elliptic previously launched an investigation into Huione Group

Elliptic's report reveals that the Huione Guarantee marketplace facilitated over $11 billion in illicit transactions involving money laundering and cyber scams across Southeast Asia, using Tether for payments.

Tom Robinson, Elliptic’s co-founder and chief scientist, highlighted the blockchain’s transparency in tracking and blocking these transactions.

Huione Guarantee’s marketplace operates mainly in Chinese and involves numerous instant messaging app channels managed by separate merchants.

Services include selling personal data, money laundering, developing scam websites, and tools for imprisoning and torturing scam workers.

While various payment methods are used on the platform, Tether is preferred for its trackability compared to traditional fiat flows.

A Tether spokesperson emphasized the need for direct engagement to freeze illicit activities, criticizing those who publicize findings without intervention.

Elliptic identified hundreds of crypto addresses linked to Huione Guarantee and its merchants.

Robinson noted that businesses could use blockchain analytics to avoid transactions with these entities by screening transactions and wallets for links to them.