As a centralized blockchain, Tether is able to blacklist addresses that are associated with money laundering and other cybercrimes. In 2021, Tether blacklisted a total of 312 addresses, adding to the current total of 799.
Tether has yet to reveal the reason for blacklisting the addresses, but it has used its role to blacklist addresses involved in cybercrimes and law enforcement investigations. After the hack on Kucoin exchange in September 2020, Tether held nearly $35 million worth of USDT to prevent hackers from benefiting from the theft.
The point for blacklisting may be due to some precautionary reasons like scams, which Arcane Assets CIO Eric Wall referred to as the reason for the Tether freeze back in 2020.
USDT remains the most widely adopted US dollar-based stablecoin today. It is followed by Circle’s USDC, which is now the sixth highest cryptocurrency in terms of market capitalization. Binance USD and TerraUSD are in third and fourth place, respectively.