Owners of $USDT tokens in Russia may have their assets blocked. At least, this was stated by the Chairman of PSB bank, Petr Fradkov, in an interview with RBC. According to him, the issuer company Tether freezes tokens at its discretion. According to PSB, companies from Iran and Russia have recently faced such blockades. Sources of "Kommersant FM" confirm the risk.
Sometimes the amounts reach several million dollars, says the founder of the legal agency Cartesius, Ignat Likhunov:
"Tether Limited has been actively using the tool of token freezing for several years. The company does this in various networks where the $USDT token is officially issued—ERC-20, TRC-20—for the purposes of combating crime and implementing sanctions policy. It's important to understand that Tether Limited does not see the 'color of the passport' in the blockchain. The company uses AML tagging tools that establish connections between wallets. If it is discovered that certain wallets hold tokens received from addresses affiliated with sanctions lists, Tether can block those addresses.
We have also had such cases in our practice: for example, people's wallets were blocked with amounts of several million dollars simply because just 1% of the assets on them came from addresses marked as $USDT blacklisted. Is it possible to somehow protect oneself from freezing $USDT tokens? A user cannot insure against this in any way because the marking can appear retroactively. The initial reason for the blocking remains unclear: the user only sees that the $USDT is marked as blacklisted.
Tether Limited, of course, tries not to abuse such blockades to avoid undermining trust in its token. However, given the volume of funds recently being frozen, this process is becoming increasingly noticeable. Tether has the ability to essentially seize funds from one user and return them to another. For instance, if someone's coins are stolen and transferred to another address, Tether can freeze them on that address and then burn them. This is a special mechanism: roughly speaking, the company de-issues these tokens and then re-issues them, but this time to the victim's wallet. Thus, a process of seizing funds and returning them to the owner actually occurs."
However, only those companies that directly or indirectly fall under American or European sanctions are primarily at risk, notes the partner of the law firm Digital & Analogue Partners, Yuri Brisov. According to him, holders of $USDT tokens need to carefully monitor which platforms they store their assets on:
"Since 2022, they immediately stated they would cooperate with OFAC and prevent the circumvention of European sectoral sanctions. And they have been consistently and openly engaged in this: they always provide justification for why a particular wallet or wallets were blocked. They do not act on personal discretion but always coordinate this with law enforcement agencies, OFAC, and the U.S. Department of Justice.
Who among $USDT token holders is at the greatest risk today? Currently, if a Russian citizen buys tokens on any legal exchange that still provides such services in Russia and uses them for private purposes, this is absolutely legal and does not violate any sanctions. Only the activity of a sanctioned individual buying tokens to circumvent sanctions can be blocked via $USDT. This does not apply at all to ordinary citizens and ordinary companies."
In March of last year, Tether blocked wallets on the Russian crypto exchange Garantex. Later, the issuer explained this move as due to sanctions against the platform imposed by the U.S. Treasury. According to estimates from "Kommersant FM" sources, users lost access to assets worth over 2.5 billion rubles.
Nikita Putyatin
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