The United States Department of Justice (DOJ) is seeking the forfeiture of more than $61 million in Tether's USDT stablecoin, alleging that the funds derived from black-market sales of sanctioned Iranian oil and were intended to finance Iran's government and military, including the Islamic Revolutionary Guard Corps (IRGC). USDT is the largest stablecoin by market value, and civil forfeiture — the mechanism behind Monday's action — targets property itself, allowing the government to seize assets it alleges are proceeds of crime without filing criminal charges against an owner.

In a civil forfeiture complaint filed Monday, the DOJ alleged that Blessed Trust and Hexa Whale, two companies incorporated in Hong Kong, used Binance accounts to move proceeds from oil sold to buyers in China. According to the filing, a network of related addresses received and distributed more than $1.5 billion, including transfers to IRGC-linked money-transfer businesses, cryptocurrency addresses and an Iranian exchange.

A Binance spokesperson told Cointelegraph that the exchange does not permit transactions with sanctioned individuals and would continue cooperating with law enforcement, including by investigating, restricting or freezing accounts where appropriate. The spokesperson added that the case was not filed against the exchange and does not allege wrongdoing by Binance.

The enforcement action comes as Washington expands financial pressure on Tehran and the US-Israeli war with Iran disrupts energy infrastructure and oil shipments across the Middle East. Oil prices rose on Tuesday following attacks on Saudi infrastructure and continued reductions in vessel traffic through the Strait of Hormuz.

Tether freezes $61 million in USDT

According to the complaint, Tether froze approximately 61.19 million USDT across 10 addresses on the Tron network in 2025. The filing states that a seizure warrant authorizes the FBI to take custody of the assets having Tether destroy the frozen tokens and issue replacements of equal value, to be transferred to an FBI-controlled hardware wallet. The burn-and-reissue arrangement hinges on the control stablecoin issuers hold over tokens on public blockchains — the same capability that made the freeze possible.

Cointelegraph contacted Tether for comment but had not received a response by publication.

The DOJ said the allegations contained in the civil forfeiture complaint have not been proven. The United States would obtain permanent ownership of the assets only if a court enters a forfeiture judgment in the government's favor.

The action also follows the US Treasury's August expansion of its Iran sanctions framework to cover the country's digital asset sector. The measure allows US authorities to target foreign individuals and companies operating in or supporting the sector. At the time, the Treasury alleged that UAE-based broker Ivan Obukhov had processed more than $100 million in crypto payments since 2023 to facilitate Iranian oil sales for the IRGC's Quds Force.

Iran conflict pushes oil prices higher

The war between the US and Israel and Iran, which began in February, continues to disrupt oil shipments through the Middle East. Reuters reported on Tuesday that Saudi Arabia's East-West pipeline remained offline after Friday attacks that Riyadh blamed on Iran-backed fighters in Iraq, while Iran-backed Houthi forces launched separate missile and drone attacks on Saudi Arabia on Monday.

At the time of writing, market data showed Brent crude trading at about $107.59 per barrel, up 1.81%, while US West Texas Intermediate traded at roughly $103.35, up 1.93%.