Tether Says It Froze Over 4.5 Million USDT Tied to Mercado Bitcoin Incident

Tether froze “more than 4.5M $USDT” linked to the security incident at Brazilian crypto exchange Mercado Bitcoin, CEO Paolo Ardoino said on Nov. 2 at 10:06 a.m. ET.

Deposits and withdrawals at Mercado Bitcoin remain suspended after what it described as an overnight security incident in one of its systems. The exchange said customers had suffered no losses and no data had leaked.

Under $USDT’s Ethereum contract, blacklisting blocks outgoing token transfers but leaves the balance at the address. The freeze therefore does not itself return funds to Mercado Bitcoin or its customers.

Ethereum transaction records show an address was added to $USDT’s blacklist at 6:38 a.m. ET on Nov. 2. Tron records show a blacklist action at 6:37 a.m. ET against another wallet. Both wallets appear in Mercado Bitcoin’s subsequent list of destinations for movements related to the incident. Ardoino’s post did not break down the frozen amount by chain.

The incident-linked destinations also received assets other than $USDT. Etherscan shows a transfer of about 2,852.07 ETH to the Ethereum address identified by the exchange. The Bitcoin address it listed had received about 106.07 BTC. Those figures describe onchain movements, not a total loss estimate.

Tether had already announced a $20 million investment in Mercado Bitcoin in July, as The Defiant reported.

Mercado Bitcoin said its teams were investigating, tracing assets and coordinating with the relevant authorities. In its 9:24 a.m. ET update, the exchange said it was working to restore operations safely, without giving a reopening timetable.