DOJ Seizes $84M from Tether-Linked Payment Processor Over Illicit Transfers

The U.S. Department of Justice (DOJ) has seized $84 million from Capstone, a payment processor linked to Tether, the largest stablecoin issuer in the market.

Capstone was accused of facilitating illegal transfers and converting stolen elder fraud cash into stablecoins on behalf of Tether and its sister company Bitfinex.

The seized funds were held in Capstone's accounts at Wells Fargo and JPMorgan Chase, with prosecutors noting that almost two-thirds of the $700 million transferred through these banks went to hundreds of individuals and entities on behalf of Tether and Bitfinex.

Tether has denied any wrongdoing, stating that it did not know about any illicit activities conducted by Capstone as alleged by the DOJ. However, this incident highlights the ongoing challenges crypto companies face in accessing banking services, even after the end of Operation Chokepoint 2.0.