---
title: "Tether’s $3.3B Freeze Highlights Sharp Policy Gap With Circle’s $109M"
date: 2025-12-25
author: "Barry Elad"
featured_image: "https://sqmagazine.co.uk/wp-content/uploads/2025/12/tether-s-3-3b-freeze-highlights-sharp-policy-gap-with-circle-s-109m.jpg"
categories:
  - name: "Cryptocurrency"
    url: "/crypto.md"
tags:
  - name: "News"
    url: "/tag/news.md"
---

# Tether’s $3.3B Freeze Highlights Sharp Policy Gap With Circle’s $109M

Tether has frozen nearly 30 times more funds than Circle since 2023, revealing a major difference in how stablecoin giants approach enforcement.

## Quick Summary – TLDR:

- Tether froze $3.3 billion across 7,268 wallet addresses between 2023 and 2025, mostly on the Tron network.
- Circle froze $109 million across 372 addresses, primarily on Ethereum, and only under court or regulatory orders.
- Tether uses a freeze, burn and reissue model to recover assets quickly in coordination with law enforcement.
- Circle follows a strict legal-first approach without burning or reissuing tokens, ensuring higher legal safeguards.

## What Happened?

Blockchain analytics firm [AMLBot released a report](https://blog.amlbot.com/stablecoin-freezes-2023-2025-a-data-backed-analysis-of-usdt-vs-usdc-by-amlbot/) revealing how the two largest stablecoin issuers, Tether and Circle, differ dramatically in how they freeze wallets linked to illegal activity. From 2023 to 2025, **Tether blacklisted over 7,000 wallets**, freezing about **$3.3 billion**, while **Circle froze just $109 million across 372 addresses**.

The report shines a light on the **divergent philosophies** the companies follow in responding to fraud, sanctions, and regulatory requests.

> AMLBot reported that between 2023 and 2025, Tether and Circle froze approximately $3.3 billion and $109 million in crypto assets via their freezing mechanisms—a roughly 30x gap. The report said Tether blacklisted 7,268 addresses during the period, with over 2,800 handled in… [pic.twitter.com/5ro5R81Ueg](https://t.co/5ro5R81Ueg)
> 
> — Wu Blockchain (@WuBlockchain) [December 25, 2025](https://twitter.com/WuBlockchain/status/2004081069356994643?ref_src=twsrc%5Etfw)

 ## Tether’s Aggressive Asset Recovery

Tether’s enforcement model is highly proactive. According to AMLBot, **more than 2,800 of Tether’s blacklist actions were done in coordination with U.S. law enforcement** agencies, targeting scams, fraud, and other forms of cybercrime.

- A large portion of these freezes occurred on the **Tron blockchain**, accounting for **over 53 percent** of Tether’s total frozen funds.
- The firm also uses a **“freeze, burn and reissue” mechanism**, allowing it to destroy compromised tokens and reissue new ones.
- The [Ethereum](https://sqmagazine.co.uk/ethereum-statistics/) network still holds **$1.54 billion worth of frozen [Tether](https://sqmagazine.co.uk/tether-statistics/)** in blacklisted wallets.

This model allows Tether to move fast and restore stolen assets or block illicit funds before they can be moved further.

## Circle’s Legal-First Philosophy

In contrast, Circle takes a more **restrained, legally conservative approach**. The company **only acts under formal legal orders**, whether through courts or regulatory directives.

- The **$109 million it froze** was almost entirely tied to the **Ethereum network**.
- Circle does **not destroy or reissue** frozen tokens.
- Once frozen, [USDC](https://sqmagazine.co.uk/usd-coin-statistics/) remains locked unless legally cleared for release.

This method emphasizes **legal transparency** and **user protections**, even if it means slower enforcement or less flexibility in asset recovery.

## A Tale of Two Compliance Strategies

The report from AMLBot highlights that **issuer policies and enforcement strategies have a big impact** on how stablecoins function in real-world compliance scenarios.

- **Tether works closely with investigators**, often preemptively freezing suspicious funds.
- **Circle stays within narrow legal bounds**, prioritizing formal legal processes over speed.

Each approach comes with trade-offs. Tether’s model has helped **recover funds tied to scams and trafficking**, but critics warn of **centralization risks** and **lack of user autonomy**. Circle’s model ensures clearer **legal safeguards**, though it may be slower to react in fast-moving fraud cases.

## SQ Magazine’s Takeaway

Honestly, this report is a clear reminder that not all stablecoins are created equal. I think it’s fascinating to see just how different Tether and Circle are in the way they deal with bad actors. Tether’s freeze, burn, and reissue model may sound like a superhero move, but it also means they hold **a lot of power** over users’ assets. Meanwhile, Circle sticks to the rulebook, which is reassuring but possibly slower in emergencies. If you’re using stablecoins, **knowing how these companies operate behind the scenes really matters**.