Critical vulnerability: Tether is able to freeze the USDT of any Russian citizen at the command of the United States.
The issuer of the largest stablecoin, Tether Limited, retains full control over every issued USDT, regardless of where the token is stored. This means that any Russian holder of the asset could face a freeze of funds by the company's decision. This statement was made by the Chairman of PSB, Petr Fradkov, whose bank is actively developing its own payment infrastructure, A7.
The banker emphasized that such precedents have already occurred, and this concerns not only owners involved in illegal activities. According to him, funds were also frozen on the direct orders of the U.S. administration—among the victims were major holders from Iran and Russia.
Why USDT remains under the issuer's control
Fradkov described the freeze mechanism without technical details: the issuer holds power over every token, wherever it may be. Even transferring USDT to a non-custodial or cold wallet does not guarantee the owner protection from a freeze by the company.
Such mechanisms, according to the banker, 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 Chairman of PSB pointed to the role of U.S. authorities. According to him, Tether froze 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 U.S. debt market remains in place.
The banker urged not to harbor illusions: the technology has changed, but the dependence has remained. 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 the banker's words mean for the Russian market
The warning came amid a rapid decline in the supply of USDT. 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 him, 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 number 15,000 companies of various sizes—from large exporters to small businesses and individuals. Through A7, private users pay for vacations, treatment, and education abroad.
The position of the PSB representative aligns with the authorities' stance. Russian regulators this summer called foreign issuers a vulnerable link precisely because of the U.S.'s ability to influence coin creators and freeze 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 statement is not just a warning but a marker of a systemic shift. The Russian financial sector has realized that dollar-pegged stablecoins are not a neutral instrument but an extension of U.S. financial policy. The development of ruble alternatives like A7A5 is a logical response to this structural risk, though their scale is still incomparable to the global influence of USDT. Investors should keep in mind: a "non-custodial wallet" does not equal an "uncontrolled asset."