Tether Freeze Highlights Stablecoin Control Divide

David Schwartz, former CTO of Ripple, has defended Tether's decision to freeze $42.4 million in USDT after a court warrant was issued months later.

The assets were frozen due to competing ownership claims following an informal Homeland Security Investigations request.

Schwartz argued that Tether had little choice but to secure the assets while the claims were unresolved, citing Ripple's own RLUSD stablecoin terms, which reserve broad powers for the issuer to freeze digital addresses.

The distinction becomes sharper with XRP itself, as it is a native asset rather than an issued stablecoin, and XRPL documentation makes clear that freeze and clawback functionality applies to issued tokens, not XRP.