US Seizes $61M USDT in Pig Butchering Scam

A pig butchering scam targeting victims through fabricated online romances and bogus trading platforms has resulted in the USDT seizure of more than $61 million by US federal investigators in North Carolina. The US Attorney's Office for the Eastern District of North Carolina announced the forfeiture on Tuesday, February 25.

How the Pig Butchering Scam Operated

The fraudsters posed as romantic interests and claimed exclusive trading knowledge to lure targets, according to the US Attorney's Office. Victims were funneled to polished but entirely fake cryptocurrency platforms displaying fabricated portfolio gains with unrealistically high returns, persuading them to deposit increasingly larger sums.

When victims tried to withdraw, the scammers blocked access and demanded extra fees. Investigators from Homeland Security Investigations traced the stolen funds through multiple wallets used to obscure the flow of proceeds, ultimately identifying and seizing several addresses that still held significant balances.

Prosecutors noted that Tether played an active role in the recovery. The DOJ and HSI publicly acknowledged the stablecoin issuer's cooperation in transferring the seized assets, reinforcing a broader trend of stablecoin companies collaborating with law enforcement to freeze illicit funds flowing through US dollar-pegged tokens.

The Department of Justice and HSI acknowledges Tether for its assistance in transferring these assets.

What Is a Pig Butchering Crypto Scam?

A pig butchering scam is a form of crypto fraud in which perpetrators cultivate fake romantic relationships to build trust before steering victims toward sham investment platforms. The name describes the practice of 'fattening' a target with false confidence and fabricated gains before 'slaughtering' them by stealing their deposits.

Data from Chainalysis' 2026 Crypto Scams report found that crypto scam losses hit $17 billion during 2025. AI-driven impersonation and social engineering tactics surged by 1,400% year-on-year, becoming far more lucrative than conventional phishing or giveaway schemes, according to the blockchain analytics firm.

Courts Hand Down Harsh Sentences

US prosecutors are pursuing aggressive penalties against those running these networks. In February 2026, a central figure in a pig butchering-linked crypto laundering ring involving over $70 million received a 20-year federal prison sentence, reflecting how seriously courts now treat this category of crime.

In December 2025, a Bitcoin investor reported losing his retirement savings after being groomed by an online persona using AI-generated images and a fabricated identity. The victim was convinced to move his coins into a fake investment platform before losing access entirely.

What Does This Mean for Crypto Investors?

The $61 million USDT seizure signals that federal authorities and stablecoin issuers are narrowing the gap on crypto fraud recovery. As pig butchering scams grow more sophisticated through AI-powered social engineering, Tether's cooperation with US law enforcement sets a precedent for faster asset freezes. Investors should remain cautious of unsolicited online relationships steering them toward unfamiliar trading platforms promising guaranteed returns.