THORChain technical co-founder Chad Barraford accused Tether of blacklisting and freezing 1.45 million USDT across four network vaults on Friday. The funds were unfrozen hours later, allowing trading to resume on the cross-chain liquidity protocol.
Barraford said on X that Tether provided no prior communication or explanation. "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," he wrote, adding he hoped the freeze was made "in error / misunderstanding."
The blacklisting directly halted USDT liquidity within THORChain's vaults, illustrating the centralized control Tether retains over its stablecoin despite its deployment across decentralized protocols.
The incident is the latest in a series of asset freezes attributed to Tether. Earlier in the week, cross-border payments platform Conduit Technology filed a lawsuit alleging Tether froze $2.76 million in USDT tied to a Brazilian authorities investigation launched in 2024.
In August, two Thai nationals sued Tether, claiming the stablecoin issuer froze $42.4 million in USDT after what the lawsuit describes as an "informal request" from U.S. Homeland Security Investigations.
Tether did not respond to inquiries about the THORChain freeze.
