THORChain Accuses Tether of Temporarily Freezing USDT Vaults Without Explanation
Tether froze THORChain's USDT vaults for two hours
THORChain's technical co-founder Chad Barraford accused stablecoin issuer Tether of blacklisting the network's USDT vault addresses on a recent Friday, freezing about 1.45 million USDT across four wallets.
About two hours later, Barraford reported that Tether had unfrozen all the addresses and trading would resume. No reason was given for the temporary freeze.
Key details from the incident
- Approximately 1.45 million USDT was frozen across four THORChain vault wallets.
- The freeze lasted roughly two hours before addresses were unfrozen.
- THORChain said it received no prior communication from Tether about the action.
- Cointelegraph reached out to both Tether and THORChain for comment but received no immediate response.
What THORChain said
Barraford posted on X that the company has had no communication with Tether before the freeze and is actively reaching out to start a conversation.
"We don't know why this choice was made and have had no comms with USDT before this action and are actively reaching out to have a conversation," Barraford said before the addresses were unfrozen. "We hope that this was made in error / misunderstanding."
Part of a broader pattern of complaints
This incident follows other recent accusations against Tether regarding frozen funds. Earlier this week, cross-border payments platform Conduit Technology filed a lawsuit alleging Tether froze $2.76 million in USDT tied to a Brazilian investigation from 2024. In August, two Thai nationals also sued Tether over an alleged $42.4 million freeze linked to an informal request from US Homeland Security Investigations.
Why this matters for crypto users
The episode highlights ongoing concerns about centralization risks with USDT, the world's largest stablecoin. THORChain is a decentralized trading network that allows users to swap cryptocurrencies across different blockchains without relying on a centralized exchange. When Tether can freeze addresses on its network, it raises questions about how much control the company has over assets held in third-party DeFi protocols.
What remains unclear
It is not confirmed why Tether froze the THORChain addresses or whether the action was intentional or an error, as both companies have not yet provided details. The freeze was resolved within hours, but the lack of communication from Tether leaves the circumstances uncertain.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.