Fears of Binance hack prompt Tether, Circle to freeze over $1.5 billion in funds

Tether and Circle froze more than $1.5 billion in funds amid fears of a possible hack involving Binance, NBC News reported. The report describes the action as a response to concerns surrounding the major cryptocurrency exchange, rather than confirming that a hack occurred.

Tether issues USDT and Circle issues USDC, two of the largest stablecoins in crypto markets. Stablecoins are designed to maintain a relatively stable value, typically by being pegged to the U.S. dollar, and are widely used by traders and exchanges to move funds between digital-asset markets.

The freezes highlight the control stablecoin issuers can exercise over tokens they issue. In certain circumstances, including suspected security incidents or compliance-related actions, issuers can blacklist blockchain addresses and prevent associated tokens from being transferred. Such measures can help limit the movement of funds tied to suspected theft, but can also temporarily restrict access for affected holders.

Binance is one of the world’s best-known crypto exchanges and plays a major role in digital-asset trading volumes and liquidity. Concerns involving its wallets or customer funds can have broader implications because exchanges, stablecoin issuers and blockchain networks are interconnected parts of the crypto market infrastructure. NBC News did not establish in the headline whether any suspected compromise was confirmed.