Will your USDT be blocked? Stablecoin risks
Introduction
In the summer of 2025, the GENIUS Act was passed in the US, representing the first federal regulatory framework for issuers of payment stablecoins such as USDT and USDC. This law mandated AML checks, reserve transparency, compliance with sanction lists, and other measures to bring stablecoins under banking-style regulations.
However, as oversight increases, so does the risk for users. Can assets be blocked? What are the consequences of stricter regulation? We explore these questions further in this article.
New Rules: What the GENIUS Act Changed
Key Provisions
- Stablecoin issuers are required to be licensed in the US.
- Reserve transparency has become mandatory: funds must be held only in high-liquidity assets.
- Platforms and issuers are subject to strict AML (Anti-Money Laundering) measures.
- A direct link to the Bank Secrecy Act has been established, strengthening anti-money laundering measures.
A critical requirement: issuers and platforms are obliged to block funds associated with sanction labels or suspicious transactions.
International Aspect
Although the regulation primarily concerns companies registered in the US, it also impacts international platforms. Counterparties outside the US working with US residents are now also forced to comply with American standards to avoid sanctions.
Risks for Users: Key Challenges
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Account Blocking and Asset Freezing
Using addresses associated with "dirty crypto" or transferring funds from centralized exchanges that do not comply with KYC requirements can lead to full wallet blocking. -
Restrictions on International Transactions
The new measures complicate cross-border payments, especially those involving high-risk jurisdictions. -
AML Screening Increases the Burden
If a sender does not check the recipient's address against sanction lists (e.g., Chainalysis, TRM Labs), the risk of being involved in prohibited schemes increases. -
Strengthened Privacy Control
Mandatory KYC requirements may alienate users who value anonymity.
How to Protect Yourself: Practical Recommendations
In the face of new rules, it is vital to adapt your approach to asset management. Here are five key steps:
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Use Non-Custodial Wallets
Storing large amounts on hardware wallets, such as Ledger or Trezor, provides full control over your funds. -
Diversify Assets
Do not focus solely on USDT or USDC. Consider alternatives such as DAI, stablecoins pegged to local currencies, or other licensed issuers. -
Check Addresses Before Transferring
Before every transaction, use AML screening tools like Crystal Blockchain. This will help avoid interaction with prohibited addresses. -
Work with Reliable Platforms
Ensure the exchange requires KYC and operates within a legal framework. This reduces the risk of account blocking and ensures the protection of your transactions. -
Stay Informed
Increased regulation requires vigilance. Regularly check for legislative updates and the positions of major issuers.
What to Do if KYC Is Requested?
Refusing to undergo KYC increases the risk of asset freezing. If a platform requests identification data, it is better to cooperate to ensure the safety of your funds.
Wallet Verification: Protection Before the Transfer
As regulation tightens, the importance of AML checks grows. Here is how to check a wallet to avoid risks:
- Use specific tools — such as Chainalysis or free blockchain explorers.
- Review the address history: is it associated with suspicious transactions?
- Cross-reference with regulatory sanction lists.
These simple actions will help avoid blocks and reduce reputational risk. We discussed more about effective transaction verification here.
Conclusion
The GENIUS Act strengthens oversight of crypto assets and requires a responsible approach from both companies and private users. To minimize risks, evaluate platforms, check addresses before transfers, and use non-custodial tools for storage.
A responsible attitude toward stablecoins is the key to preserving your investments in the digital economy.