The U.S. Secret Service froze $52.8 million in USDT held across 52 wallets linked to Xinbi Guarantee on September 8, after using intelligence from blockchain analytics firm Elliptic.

Xinbi Guarantee is a Chinese-language marketplace operating on Telegram that provides scammers with tools and services used to defraud victims worldwide. Unlike a conventional marketplace, it functions largely as an escrow system: vendors deposit cryptocurrency so operators can be trusted to deliver goods and services ranging from stolen personal data to money-laundering services that convert illicit funds back into cash. Buyers can be reimbursed from those deposits if they claim they were cheated.

The 52 wallets, all containing USDT, Tether's dollar-pegged stablecoin, were frozen beginning at 8 a.m. UTC on September 8. Two wallets holding approximately $12 million were seized outright under a warrant unsealed by the Department of Justice, while the remaining wallets were frozen pending further action.

“Elliptic has been tracking Xinbi and its wallet infrastructure for several years, and our intelligence directly enabled the freezing action, as well as the sanctions imposed on Xinbi today by the United States,” the company said in a statement.

According to Elliptic, Xinbi and its merchants have processed at least $24 billion in transactions since 2022, making it the second-largest illicit online marketplace the firm has tracked. Huione Guarantee processed more, moving $31 billion before Telegram shut it down in May 2025 following years of exposure by Elliptic. The shutdown came days after a separate Treasury finding identified Huione's parent group as a primary money-laundering concern. Xinbi absorbed much of the traffic after its predecessor disappeared.

A significant share of funds moving through platforms such as Xinbi originates from “pig butchering” scams. In these schemes, a fraudster develops a fake romantic or personal relationship with a victim over weeks or months before persuading the person to transfer savings to a fraudulent investment application. The application displays fabricated profits until the victim's account is emptied.

The Treasury Department's Office of Foreign Assets Control designated Xinbi as a “significant transnational criminal organization” on September 8, according to the source account; the article also states that the designation occurred on September 9. The category is the same one used for drug cartels. Singapore-based SafeW Technology and Cambodia-based Anwen Technology were sanctioned alongside Xinbi for supporting its operations. The United Kingdom had already sanctioned Xinbi in March.

Xinbi condemned the cryptocurrency freeze as “arbitrary” and said it would compensate customers. The marketplace also appears to be moving away from USDT toward USDD, a stablecoin launched by Tron founder Justin Sun that has no central issuer able to freeze wallets. Xinbi has exchanged approximately $2.8 million of its remaining USDT for USDD through a decentralized exchange.

However, USDD's reserves are partly backed by USDT, the same asset whose issuer can freeze tokens. On-chain data also indicated that funds were moving from a Xinbi address after the freeze:

Data Update Xinbi Guarantee’s business address, which had just been activated on September 8, 2026, has been frozen again. 1.8 million $USDT has already escaped, with only 37,839 $USDT frozen. On-chain data shows that the address is testing… pic.twitter.com/kqPjYiQnXn — Bitrace (@Bitrace_team) September 9, 2026

The post was published by Bitrace on September 9, 2026, at https://x.com/Bitrace_team/status/2097480480811782478?ref_src=twsrc%5Etfw.

The action was part of a broader operation by the DOJ's Scam Center Strike Force. Agents were deployed to Madagascar to assist local authorities in dismantling 13 Chinese-run scam compounds and processing evidence from nearly 400 arrestees, including more than 3,200 seized devices. The Department of Justice said the Strike Force, launched in November 2025, has seized approximately $938 million in scam-linked cryptocurrency. Xinbi's outstanding balance remains subject to the ongoing action.