FlashRescue co-founder @DarcyAri said on X that Tether's execution of a freeze proposal during a joint investigation was partially undermined when a target address moved funds before the freeze took effect, shrinking the amount that could be frozen. A follow-up review found the case was not isolated. Through Aug. 3, 2026, the team reviewed 2,955 Tether freezing events on Ethereum and TRON and identified 60 addresses that emptied their balances before execution, with net outflows of 20,429,847 USDT. On average, those addresses began transferring 13 minutes 59 seconds after the freeze proposal was submitted and finished most of their moves within 15 minutes 15 seconds. Another 113 addresses shifted partial balances ahead of freezing, involving roughly 35.52 million USDT. Tether's average handling time from proposal submission to enforced freeze was 2 hours 16 minutes 15 seconds, leaving a window between the public proposal and the actual freeze. One address cluster on July 3 moved funds within minutes into a single wallet, then split them. FlashRescue says high-risk addresses may be monitoring the proposal list and using that interval to front-run, causing freezes to fail and weakening sanctions, anti-money-laundering, and law-enforcement cooperation.
FlashRescue co-founder @DarcyAri said on X that Tether's execution of a freeze proposal was partially circumvented when a targeted address shifted its funds before the freeze was enforced, reducing the amount that could be frozen. The case emerged while FlashRescue was coordinating with partners on a joint investigation. After a follow-up review, the team said the pattern was not a one-off.
Inside 2,955 Tether freezing events
Through Aug. 3, 2026, FlashRescue reviewed 2,955 Tether freezing events on the Ethereum and TRON networks, spanning risk addresses linked to entity sanctions, fraud activity, money laundering, FATF blacklisted jurisdictions, and malicious attacks.
Key figures from the review:
- 60 addresses drained their balances before a freeze was formally executed, posting net outflows of 20,429,847 USDT. On average, they started transferring 13 minutes and 59 seconds after the freeze proposal was submitted, and completed the bulk of their fund movement within 15 minutes and 15 seconds.
- Another 113 addresses moved part of their assets before the freeze was carried out, involving about 35.52 million USDT.
A 2-hour-16-minute gap between proposal and execution
Tether's average time from submitting a freeze proposal to executing the freeze was 2 hours 16 minutes and 15 seconds. That leaves a window between the moment a proposal is made public and the moment the freeze actually takes effect.
Within the same dataset, one address cluster on July 3 shifted funds within minutes, routed them into a single address, then split them apart again.
The cases suggest some high-risk addresses may be actively monitoring Tether freeze proposals and using the time difference between disclosure and enforcement to front-run the freeze. The mechanism leaves the involved funds unfrozen and weakens the practical effect of sanctions, anti-money-laundering measures, and law-enforcement cooperation.
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