The threat of USDT freezing: why Tether may block Russians' assets on orders from Washington
Control over the issuance of the USDT stablecoin remains in the hands of Tether Limited, creating an existential risk for holders worldwide, including Russians. The issuer is capable of freezing any tokens regardless of where they are stored—on an exchange, in a cold wallet, or in a non-custodial application. This statement came from PSB Chairman Petr Fradkov, whose bank is actively promoting its own settlement infrastructure based on the ruble stablecoin A7.
The banker emphasized that such precedents have already occurred, and not only regarding owners involved in illegal activities. According to him, funds were also frozen on direct orders from the American administration. Among those affected were major holders from Iran and Russia.
The Mechanism of Absolute Control
Fradkov described the freezing mechanism without technical details: the issuer retains authority over every token, wherever it may be. Even transferring USDT to a non-custodial or cold wallet does not guarantee the owner protection from blocking by the company.
According to the banker's assessment, such mechanisms have already been applied in practice. In recent years, large assets of holders from Iran and Russia have been frozen, with decisions made not only due to holders' ties to illegal activities.
Separately, the PSB chairman pointed to the role of American authorities. According to him, Tether blocked funds simply at the direction of the U.S. administration, turning a formally private instrument into an externally controlled asset. Fradkov explained this dependence through the structure of reserves. The company issuing USDT is among the largest holders of U.S. Treasury bonds, so the peg to the dollar and the American debt market remains inescapable.
The banker urged against harboring illusions: technology has changed, but the dependence remains. Even a modern digital instrument, he emphasized, remains fully controlled by the issuer, and the key question is who controls the token's circulation infrastructure.
What This Means for the Russian Market
The warning came amid a rapid decline in USDT supply. The market capitalization of the largest stablecoin fell at a record pace in early August, and analysts linked this outflow to investors fleeing risky assets.
Fradkov raised the topic of risks while promoting an alternative—the ruble stablecoin A7A5. According to his data, the token's turnover has reached nearly $140 billion since launch, and the A7 platform processes up to 2,000 payments per day. The system's regular clients include 15,000 companies of various sizes, from large exporters to small businesses and individuals. Through A7, private users pay for vacations, medical treatment, and education abroad.
The PSB representative's position aligns with the authorities' stance. Russian regulators this summer called foreign issuers a vulnerable link precisely because of the possibility of the U.S. influencing coin creators and freezing holders' assets. At the same time, the state did not completely close access to dollar tokens. From September 1, 2026, qualified investors will gain a legal opportunity to buy USDT and USDC through domestic licensed platforms, and companies will be able to use them in foreign trade settlements.
My analysis: Fradkov's statements are not just a warning but a signal of a fundamental shift in the perception of stablecoins. The market is finally realizing that "non-custodial" does not equal "uncontrollable." As long as Tether holds billions in American government securities, its loyalty to Washington will determine the fate of holders' assets. For Russians, this means that diversification into national stablecoins is not a whim but a matter of capital survival.