Tether freezes USDT in 131 ISIS-K-linked TRON wallets: Chainalysis

Tether has frozen USDT balances in 131 TRON wallets linked to ISIS-K after U.S. sanctions officials added more than 100 crypto identifiers tied to the group. 

The move places stablecoin issuer controls at the center of a new terrorism-financing action involving TRON and Monero addresses.

Chainalysis said the U.S. Treasury’s Office of Foreign Assets Control updated its ISIS-K designation on July 1. The update added 134 crypto wallet identifiers, including 131 TRON addresses and three Monero addresses. 

“Tether has frozen the balances on all 131 TRON addresses,” said Chainalysis.

The official OFAC update lists the wallets under ISIL Khorasan, also known as ISIS-K. The group is the Islamic State’s Afghanistan and Pakistan branch. OFAC had already designated ISIS-K as a terrorist group before adding the new crypto wallet identifiers.

Chainalysis tracks Tether flows across TRON wallets

Chainalysis said the 131 TRON addresses had received more than $1.4 million since 2023. The same wallets sent out more than $880,000 over that period. The blockchain analytics firm said several listed wallets had exposure to mainstream services and also sent funds to Syria-based crypto exchangers.

The report said ISIS-K’s media branch, al-Azaim Media Foundation, has used websites and messaging platforms to seek crypto donations. Chainalysis said it had collected past donation addresses on TRON, Monero, and Bitcoin. The firm also noted that earlier public terrorism-financing campaigns often used smaller donations, rather than a few large transfers.

Stablecoin freeze role keeps growing

The latest freeze follows a wider rise in issuer-level enforcement around USDT. As previously reported, Tether’s T3 Financial Crime Unit passed $450 million in frozen suspected illicit assets since its 2024 launch. The unit is backed by Tether, TRON, and TRM Labs, and focuses on USDT activity on the TRON network.

Moreover, Tether froze more than $514 million across 370 addresses during one 30-day period earlier this year. Most of the frozen funds were on TRON. BlockSec data cited in that report showed Tether blacklisted 4,163 addresses in 2025, freezing $1.26 billion across Ethereum and TRON.

Sanctions pressure reaches compliance teams

The ISIS-K action also comes after other terrorism-linked wallet freezes this year. Victims with U.S. terrorism judgments asked a New York court to order Tether to turn over 344,149,759 USDT held in two OFAC-blocked TRON wallets linked to Iran’s IRGC. That case centers on whether frozen stablecoins can be transferred to judgment creditors.

Chainalysis said the July 1 actions require virtual asset service providers and financial institutions to update sanctions screening and transaction monitoring. The firm also said it labeled the relevant addresses in its products. The step gives compliance teams a way to detect exposure to the newly listed ISIS-K wallets and related networks.