The US Secret Service froze $52.8 million in USDT across 52 wallets tied to Xinbi Guarantee, a Chinese-language Telegram-based marketplace, in a major operation targeting global crypto scams. The freeze took place on September 8 and relied on intelligence generated by blockchain analytics firm Elliptic.
Treasury sanctions and DOJ enforcement
On the same day, the Treasury Department’s Office of Foreign Assets Control (OFAC) designated Xinbi as a significant transnational criminal organization. The Department of Justice’s Scam Center Strike Force, which has been pursuing cybercriminal operations since November 2025, reported that it has now seized $938 million in scam-linked cryptocurrency.
Elliptic stated that its tracking of Xinbi and its wallet infrastructure over several years directly enabled both the freeze and the sanctions. The company added that its intelligence led US authorities to take coordinated action against Xinbi and its support network.
Out of the 52 wallets targeted, two containing approximately $12 million were seized under a newly unsealed DOJ warrant. The remaining wallets, all holding USDT, remain frozen pending further investigation.
How Xinbi operates
Xinbi Guarantee is not a conventional marketplace, but rather an escrow-based platform where vendors post crypto deposits to ensure mutual trust. These deposits act as collateral, and buyers who feel defrauded can be reimbursed from the escrowed funds, making such platforms attractive to cybercriminals dealing in stolen personal data or money-laundering services.
Since 2022, Xinbi and its merchants processed at least $24 billion in transactions, according to Elliptic. This makes it the second-largest illicit online market tracked so far, trailing only Huione Guarantee, which handled $31 billion before being shut down by Telegram in May 2025 following years of investigation.
Elliptic analysts observed that Xinbi rapidly absorbed illicit transaction volumes after Huione’s closure, capitalizing on the proven demand for such services within criminal networks.
Xinbi’s ties to global scams are extensive, including operations built on “pig butchering” schemes that lure victims into fraudulent online relationships and convince them to invest in fake apps showing phony profits.
Global reach and new countermeasures
OFAC sanctioned two more firms alongside Xinbi: SafeW Technology, based in Singapore, and Cambodia’s Anwen Technology. Both companies allegedly supported Xinbi’s operations. The UK government had already placed Xinbi under sanctions in March.
In response to the asset freeze, Xinbi issued a statement labeling the government’s action “arbitrary” and promised to reimburse affected customers.
The platform quickly began shifting funds: roughly $2.8 million in USDT was swapped for USDD, a stablecoin issued by Tron founder Justin Sun. Unlike USDT, USDD lacks a mechanism for externally freezing wallets. However, some of USDD’s reserves remain backed by USDT, exposing Xinbi to ongoing regulatory risks.
Platforms like Xinbi are increasingly seeking alternatives for asset storage, but the technical interlink between stablecoins can undermine those efforts, especially when reserve backing creates indirect exposure to regulatory controls.
The DOJ’s Scam Center Strike Force expanded its operations globally during the same period, assisting Madagascar authorities in dismantling 13 scam compounds led by Chinese nationals. The efforts resulted in nearly 400 arrests and the confiscation of over 3,200 devices.
Amid rapidly shifting enforcement tactics and the complex technical landscape, market observers have noted that traders often lose track of critical developments by switching between separate platforms for monitoring charts, news, and portfolios. In a market where a single Fed decision or a sudden altcoin listing can change everything in seconds, smart traders are now utilizing privacy-first tools like CryptoAppsy to consolidate everything. Without even the hassle of creating an account, users gain access to real-time charts, smart price alerts, coin-specific news, and macro data on one screen.
The Secret Service’s recent action against Xinbi is part of a wider crackdown on criminal crypto ecosystems that rely on stablecoins for illicit finance. Investigations are ongoing, and Xinbi’s unfrozen balances remain under scrutiny as enforcement agencies push for further seizures.
