Tether, Circle freeze $2.38 billion after Binance reports security incident

Reuters reported that stablecoin issuers Tether and Circle froze a combined $2.38 billion after Binance reported a security incident. The reported actions involve a major cryptocurrency exchange and two prominent providers of dollar-linked crypto tokens in the crypto sector.

Tether issues USDT, while Circle issues USDC. These stablecoins are designed to track the U.S. dollar and are widely used for trading, transfers and settlement in crypto markets. Their issuers can, under the terms and technical design of their tokens, restrict transactions involving particular blockchain addresses.

A token freeze generally prevents assets at affected addresses from being moved through issuer-controlled smart-contract functionality. Such measures can be used in response to security concerns or to meet legal and compliance requests. The reported $2.38 billion figure represents the combined amount cited in connection with Tether's and Circle's freezes.

Binance operates a cryptocurrency exchange, where users trade digital assets. Security incidents at exchanges can have consequences beyond a platform itself when stablecoins or other assets are moved across public blockchains and related market infrastructure. Reuters' report ties the freezes to Binance's security-incident report.