Tether Froze $1.7M In USDT That Were Stolen In The YFI Exploit

Tether froze $1.7 million in USDT that were stolen in the recent YFI exploit while BitFinex made a final loan repayment of $550 million to Tether as we are reading more in our latest Tether news.

Following the latest Yearn.finance protocol attack, the major US dollar stabelcoin company Tether froze $1.7 million worth of USDT coins that were stolen from the platform. In the meantime, Bitfinex disclosed that it had made the last loan repayment to Tether. Paolo Ardoino, Tether’s CTO announced the news of the freeze via his Twitter profile on Friday and the company’s action would prevent the hacker from spending these stolen funds.

. @Tether_to just froze 1.7M USDt stolen as part of the hack of Yearn DAI v1 vault.
More info here https://t.co/MjGScEucQB

— Paolo Ardoino (@paoloardoino) February 5, 2021

The news of the attack was initially reported by the Decentralized finance protocol on Twitter which revealed that the YFI v1 DAI vault suffered an exploit. In the press release published afterward, the team was able to mitigate the attack under 11 minutes and saved about 24 million DAI out of the 5 million DAI in the vault with $11 drained from it. The malicious actor managed to profit $2.7 million from the flash loan attack but Tether’s decision to freeze the stolen funds gathered plenty of criticism from members of the crypto community.

Some from the community-made comments that Tether’s action went against the decentralization postulates while others stated that the company was ruining its reputation with claims that the USDT company was becoming more centralized. Ardoino responded to the criticism and said:

 “I want to use this occasion to remind everyone that Tether $USDt is a centralized stablecoin using blockchains as a transport layer. Among Tether duties there is the responsibility of acting and collaborating with LE and regulators regarding potential dangerous behavior.”

In the meantime, this was not the first time that Tether froze USDT funds and allowed an attack on the crypto platform. After the hack of KuCoin which cost the exchange $280 million, the company froze $33 million worth of crypto. Bitfinex on the other hand revealed that it had paid Tether the remaining loan balance of $550 million and now the crypto exchange made the payment entirely in fiat. Back in 2019, the NYAG office accused Bitfinex of using over $700 million from the Tether reserves to cover up the losses of $850 million and the crypto exchange stated that the $850 million was sent to Crypto Capital Corp with Bitfinex adding that the funds are seized and protected.