US Treasury Sanctions $24B Scam Hub Moving Millions to USDT Rival

US authorities just hit a massive crypto marketplace with heavy sanctions after tracking billions in illegal funds. The Treasury Department designated Xinbi Guarantee as a transnational criminal organization on Wednesday, while the Justice Department seized its digital wallets and infrastructure. According to federal reports, the platform processed more than $24 billion in crypto and fiat assets since 2022, serving various criminal groups and sanctioned entities.

The crackdown followed a familiar pattern of criminals shifting operations after earlier law enforcement actions against similar platforms like Huione Pay. Facing rising pressure, Xinbi reportedly tried to move its merchant networks to an encrypted messaging app and launched its own wallet tools. However, blockchain intelligence helped authorities freeze over $50 million in tether assets just days before the formal announcement.

Following the asset freezes, administrators at the marketplace openly criticized the action and announced plans to shift funds to USDD, a Tron based stablecoin that lacks a built in freeze function. Traders and analysts are watching closely to see how regulators respond to illicit networks migrating toward alternative stablecoins and decentralized payment rails.

This latest enforcement action highlights the growing pressure on stablecoin issuers and privacy apps to cooperate with international law enforcement. As authorities continue targeting scam compounds in Southeast Asia, the crypto market will likely see increased scrutiny on how alternative stablecoins handle illicit transactions.