Stablecoins? They can be freezed? Should i use them and worry?

[beerlover]

T be honest i would not take it easy this let's say i have about 3000 USD in stablecoins and they will be just gone for sure i will find wich hand was stealing my funds and making the person counteble If legal ways works because how can we operate If no trust ?

Yes they can. Don't let anyone tell you otherwise because they can. If you take your money out of the system all together then maybe they can't be, but then they will be looked for anyway it will go back in, and then freeze. You might be not realizing how risky stablecoins are because these are coins which companies are printing out of thin air, and you need to realize how these are going to be very dangerous to hold.

It's the worst kind of centralization, a single person at the right place could take all your money, reverse whatever, or freeze your account, and you are not going to get your money back. This is why bitcoin is decentralized, because we are talking about something which will never be controlled by any person.

[Hispo]

Unless you have been involved in an exchange's heist, terrorism, or that type of thing, you probably shouldn't worry about Tether (or any token issuer) freezing your assets. But yes, it is possible for them to do so, if they want to. A few examples here[1][2].

As for the alternative, then you can check this discussion[3]. It's been two years though, so some things might have changed since then. Make sure to do more research if decide to go with one of the suggested tokens.

[1] https://cointelegraph.com/news/tether-freezes-usdt-phishing-scams
[2] https://tether.io/news/tether-freezes-32-addresses-linked-to-terrorism-and-warfare-in-israel-and-ukraine/
[3] https://www.reddit.com/r/ethereum/comments/z6shcr/which_stable_coins_do_not_freeze_assets/

Also, I have got a question on some rumor about Tether's way to operate. It has been suggested before the organization behind Thether declares net incomes depending of the seizing of USDT from criminal organizations or subjects who are sucpects of partaking in crimes. For example, if they manage to freeze/seize one million dollars, that means there are up to one million in cash or cash equivalents in their reserves which it would become unable for criminals to claim, so they simply take that amount as a profit for Tether itself (the organization behind). If that is true, then it means those in charge of freezing token have a incentive for them to do so, which could (in the worst case scenario) turn into a motive for false-positive cases to start to appear. I mean, people who do not have anything to do with crime and yet get their funds frozen...

[jaberwock]

Stablecoins are mostly owned and operated by centralized institutions so if you are scared of any authority having access to your funds then don’t use it. But it’s not like stablecoins get frozen for no reason. Obviously they will freeze those who have suspicious activity or have caused harm to other people. If you don’t do any of the sort then you can just use stablecoins.

Just consider that stablecoins are not as decentralized as other coins.

Authorities are authorized, so why not? Though there are corruption and other forms of anomalies that can happen, so it is also better to be safe than sorry. Stable coins or not but as long as we store our cryptos in a centralized platform, we can also get restricted, so this must be the first one that we should look at or much better to use a decentralized platform instead.

There are decentralized type of stable coins and I think they are not different from the other decentralized cryptos. Decentralized stable coins can sometimes de-pegged but I think this is only their equivalent of volatility or bear market. It might only be rare, so if we are only after them, it is better to just go on the other decentralized cryptos.

[justdimin]

T be honest i would not take it easy this let's say i have about 3000 USD in stablecoins and they will be just gone for sure i will find wich hand was stealing my funds and making the person counteble If legal ways works because how can we operate If no trust ?

Yes they can. Don't let anyone tell you otherwise because they can. If you take your money out of the system all together then maybe they can't be, but then they will be looked for anyway it will go back in, and then freeze. You might be not realizing how risky stablecoins are because these are coins which companies are printing out of thin air, and you need to realize how these are going to be very dangerous to hold.

It's the worst kind of centralization, a single person at the right place could take all your money, reverse whatever, or freeze your account, and you are not going to get your money back. This is why bitcoin is decentralized, because we are talking about something which will never be controlled by any person.

While some people think "oh if you stole the money or involved in terrorism" the reality is: "if the government wants your money". These centralized companies behind all these currencies have to follow the law, so if government decides you are a bad guy, then they can freeze your assets just like they do at banks as well. So assume you have USDC at Coinbase, and government seizes your assets, they just mail Coinbase and tell them to freeze your account, and Coinbase will follow, as simple as that.

Do you think these countries are always fair? Like if we could have governments decide everything, they are always fair and great? Of course not, they are not, and they are sometimes doing shady stuff as well, so your money could be gone.

[Apocollapse]

If I want to hold stable currency, my choice would be:
1. Fiat
2. DAI
3. Centralized stable coins

Since I'm not live in a country where the legal tender aren't Dollar or Euro, instead a more inflated fiat than Dollar. So this make me choose to hold DAI, at least it's safer than centralized stable coins e.g. USDT, USDC. Fiat is more safe for me since it's insured by institution like FDIC.

[sarmrakib]

There is no reason to freeze your fund if there is nothing happen with the account. I have never faced any issue in any exchange. However though nothing happen lile this still the question could be raise when we have seen many hacking happen on crypto. Mostly its happen when we use decentralized platform with less security. Also when exchange found any inappropriate working activists with your account it can be happen and team could be freeze the fund and again if you can prove the legality of your account this restrictions could be removed.

[Abiky]

While some people think "oh if you stole the money or involved in terrorism" the reality is: "if the government wants your money". These centralized companies behind all these currencies have to follow the law, so if government decides you are a bad guy, then they can freeze your assets just like they do at banks as well. So assume you have USDC at Coinbase, and government seizes your assets, they just mail Coinbase and tell them to freeze your account, and Coinbase will follow, as simple as that.

Do you think these countries are always fair? Like if we could have governments decide everything, they are always fair and great? Of course not, they are not, and they are sometimes doing shady stuff as well, so your money could be gone.

Exactly. You're never safe from governments' "evil hands". They can confiscate or even freeze access to your funds whenever they want to. Their efforts succeed when you leave everything in the hands of a custodian or third party. Centralized exchanges, centralized wallets, and spot ETFs are a huge no-go for me. Self-custody (non-custodial) would be the best way to protect your crypto from harms way.

I'd suggest you hold decentralized stablecoins for complete peace of mind. I'm talking about coins such as DAI, USDD, and USDJ. These have no freeze function implemented on their underlying code, unlike their centralized counterparts (USDC, USDT, etc). This is for the truly-paranoid. If you have nothing to hide or don't care about government oversight, then centralized stablecoins are for you. It's a "free market" (as in liberty), anyways.

[DeathAngel]

You are very unlikely to have any funds frozen unless you have been involved in criminal activity or money laundering or you are living in a country where crypto is banned. Law abiding citizens don’t tend to get funds frozen.

[Kavelj22]

The chances of success of launching a stable cryptocurrency pegged to the US dollar depend on several factors, including the ability of the new currency to provide stability in value compared to volatile cryptocurrencies, the transparency of its reserves, and the trust of users in it. In addition, the new currency must enjoy wide acceptance in the market, provide smooth transactions, and be supported by a strong infrastructure. The intense competition in this field, and the tightening of regulatory oversight, represent significant challenges that must be taken into account. To increase the chances of success, the new project must focus on building strong relationships with financial institutions, developing strategic partnerships, and providing innovative solutions that meet the needs of users. The project must also be transparent about its mechanism of operation, and be subject to continuous auditing by independent experts.

[Abiky]

You are very unlikely to have any funds frozen unless you have been involved in criminal activity or money laundering or you are living in a country where crypto is banned. Law abiding citizens don’t tend to get funds frozen.

Really? I've thought governments randomly pick subjects if they consider their activities to be suspicious (Big Brother). Even if you're not breaking the law, you can easily get flagged if the government sees constant movement of money across the Blockchain. Stablecoins are even worse than decentralized cryptocurrencies. They're strictly KYC-compliant. It's like having a credit/debit card with all of the benefits of crypto/Blockchain tech. I'm talking about centralized stablecoins, of course. Decentralized stablecoins are another subject.

For people living abroad, stablecoins can do wonders. You can use the USD or even EUR, without the need to travel to the US or EU and open a bank account. Just hold the stablecoin of your choice and use it to transfer money across borders or simply buy/sell cryptocurrencies without ever touching your national currency (Fiat). Countries with high inflation rates can benefit from this. Other that, I'd suggest you choose BTC or XMR for complete peace of mind.

[Marvell1]

While some people think "oh if you stole the money or involved in terrorism" the reality is: "if the government wants your money". These centralized companies behind all these currencies have to follow the law, so if government decides you are a bad guy, then they can freeze your assets just like they do at banks as well. So assume you have USDC at Coinbase, and government seizes your assets, they just mail Coinbase and tell them to freeze your account, and Coinbase will follow, as simple as that.

Do you think these countries are always fair? Like if we could have governments decide everything, they are always fair and great? Of course not, they are not, and they are sometimes doing shady stuff as well, so your money could be gone.

Yes, the government can freeze our money if it is in the form of centralized stablecoin but is it really as serious as you say? If you don't break the law, don't engage in money laundering, terrorism...then there's no reason to fear that they will do those things to you. And if you are a criminal, a terrorist and your money is dirty money, do you think you can escape government surveillance even if you use decentralized coins?


Let's be real: have you ever had your money stolen or frozen by the government for no reason when you did nothing wrong? As I said above: they can freeze our money but not as severe as you describe, you are over exaggerating.

[danherbias07]

Stablecoins are like your simple fiat, they cannot freeze it without any proper reason on why they will freeze your account or your wallet unless you have done something that will make them doubt your account.
But if they did freeze it without you having any knowledge of doing things that are unnecessary or against the law, then you can always fight back and reason with it.
They are mostly pegged with USD which also means they are leaning with the value of it and they cannot just do what they want with it, unlike other coins which were created by a developer for other reasons. You have nothing to worry about but you don't also want to be fixed with the idea of hoarding it and stashing it. Might as well keep Ethereum or Bitcoin and it's more worthy than keeping stablecoins whose value would never go up even in the long run.

[betswift]

Stablecoins are like your simple fiat, they cannot freeze it without any proper reason on why they will freeze your account or your wallet unless you have done something that will make them doubt your account.
But if they did freeze it without you having any knowledge of doing things that are unnecessary or against the law, then you can always fight back and reason with it.
They are mostly pegged with USD which also means they are leaning with the value of it and they cannot just do what they want with it, unlike other coins which were created by a developer for other reasons. You have nothing to worry about but you don't also want to be fixed with the idea of hoarding it and stashing it. Might as well keep Ethereum or Bitcoin and it's more worthy than keeping stablecoins whose value would never go up even in the long run.

Yeah, there should be a concrete reasons for your funds being frozen.
Usually, you can sometimes get why they would be left in such a state, but sometimes, it won't make any sense to you, but for an exchange or an authority - totally, don't mind if I do 

[pooya87]

The situation is similar to what we have with centralized exchanges. There are great risks involved with using them but they still provide us with a utility so people continue using them. I'd say as long as you are well aware of the risks you are taking and don't have some illusion of safety, that helps you manage your risks in which case it is OK to use these tools be it a CEX or a stable shitcoin.

[el kaka22]

Anything where you give central control over to someone else is a dangerous thing to own. It is not just about freezing or anything else, it's about how the entire ecosystem and coin is tied to a single person at the top of the company, or a few people as a board of directors, in the end this doesn't make sense because humans are prone to mistakes and we shouldn't invest into any of them. Looking at the current situation, I can say this is going to hurt a lot of people to keep holding stablecoins.

I have said this for many years now, more than five I think, and people still do not listen, they are still investing and eventually one day when all of this goes to shit, people will realize I was right and they shouldn't have invested into these, but it will be too late.

[doomloop]

The situation is similar to what we have with centralized exchanges. There are great risks involved with using them but they still provide us with a utility so people continue using them. I'd say as long as you are well aware of the risks you are taking and don't have some illusion of safety, that helps you manage your risks in which case it is OK to use these tools be it a CEX or a stable shitcoin.

Exchanges are even bigger issues when it comes to centralized power and how they can freeze your account. Sure USDT can be very dangerous too and that's why I try to have none of it, but exchanges can literally block your account and make up some reason why you broke their rules and keep all your money. Then you can try to sue, but if you live in a different nation, that would be quite tough too, and would cause so much time lost and meanwhile they would profit from this.

Or simply any government could ask them to freeze your account and they will, just not to get in trouble with that government. So all in all, I can easily say they are not going to end up with any trouble, this is going to be a simple issue and I believe they are going to be dangerous in the future, keep your investments out of exchanges.

[albon]

Exchanges are even bigger issues when it comes to centralized power and how they can freeze your account. Sure USDT can be very dangerous too and that's why I try to have none of it, but exchanges can literally block your account and make up some reason why you broke their rules and keep all your money. Then you can try to sue, but if you live in a different nation, that would be quite tough too, and would cause so much time lost and meanwhile they would profit from this.

Or simply any government could ask them to freeze your account and they will, just not to get in trouble with that government. So all in all, I can easily say they are not going to end up with any trouble, this is going to be a simple issue and I believe they are going to be dangerous in the future, keep your investments out of exchanges.

Indeed, if a user of CEX platforms ignores their Terms of Service, does not understand the potential risks and fails to comply with every condition he agreed to before creating his account, resulting in a violation of their policies or even a single condition, or engaging in prohibited activities such as those represented by centralized stablecoins like USDT he is indeed at fault for not educating himself about it.

Although USDT is the highest-valued and most reliable stablecoin in the market, this does not prevent them from taking action against the holders of their coins, as they have the ability to control that. Anyone wishing to use USDT must conduct transactions that do not violate their regulatory and legal standards or invest in the highest market-cap coins. As for me, I have been using USDT and other stablecoins for years without any issues... However, I do not have complete confidence in them, so I do not hold them for extended periods.

[CK485]

Indeed, if a user of CEX platforms ignores their Terms of Service, does not understand the potential risks and fails to comply with every condition he agreed to before creating his account, resulting in a violation of their policies or even a single condition, or engaging in prohibited activities such as those represented by centralized stablecoins like USDT he is indeed at fault for not educating himself about it.

Although USDT is the highest-valued and most reliable stablecoin in the market, this does not prevent them from taking action against the holders of their coins, as they have the ability to control that. Anyone wishing to use USDT must conduct transactions that do not violate their regulatory and legal standards or invest in the highest market-cap coins. As for me, I have been using USDT and other stablecoins for years without any issues... However, I do not have complete confidence in them, so I do not hold them for extended periods.

Yes, basically stablecoins provide stability, but the trust given must be based on the crypto environment because market changes often occur, by always being careful when building this digital asset, of course there must be trust from investors from USDT ,I think the right choice depends on your respective priorities in assessing it.

[Abiky]

Anything where you give central control over to someone else is a dangerous thing to own. It is not just about freezing or anything else, it's about how the entire ecosystem and coin is tied to a single person at the top of the company, or a few people as a board of directors, in the end this doesn't make sense because humans are prone to mistakes and we shouldn't invest into any of them. Looking at the current situation, I can say this is going to hurt a lot of people to keep holding stablecoins.

I have said this for many years now, more than five I think, and people still do not listen, they are still investing and eventually one day when all of this goes to shit, people will realize I was right and they shouldn't have invested into these, but it will be too late.

That is otherwise known as a "single point of failure". The very fact that centralized stablecoins rely on middlemen, greatly increases the risks of loss. It's something Satoshi meant to avoid in the first place by introducing Bitcoin to the world. If you want complete peace of mind, choose decentralized stablecoins instead. No freeze function, full custody of your coins (assuming you leave them off centralized exchanges), and zero risk of the issuer shutting it down or running away with the money.

Decentralized stablecoins are governed and maintained by the community. Why do you think DAI has been a huge success? It may not have a market cap as big as Tether (USDT) or USD Coin (USDC), but it does the job it's supposed to. Among its kind, DAI is the largest stablecoin in the world. Even though the risk of loss is lower with a decentralized stablecoin, that's no guarantee it will hold its peg with Fiat currencies forever. Nothing beats good-old decentralized cryptos like Bitcoin and Litecoin, right?

[Dave1]

The situation is similar to what we have with centralized exchanges. There are great risks involved with using them but they still provide us with a utility so people continue using them. I'd say as long as you are well aware of the risks you are taking and don't have some illusion of safety, that helps you manage your risks in which case it is OK to use these tools be it a CEX or a stable shitcoin.

It's a double edge sword, we think that it's a good investment, or as others have been using them, as a hedge. And then they think that they are safe and can sleep better at night. However, when they woke up the next day, there stable coins has been seized without warning and they can't do anything about it.

And for sure this will continue to matter what, I remember when I was new here, I have heard horror stories here and in reddit that the 3rd party has confiscated their stable coins because of the suspicious on where it originated or where the funds came from.