U.
S. Freezes $52.8 Million in Crypto Linked to Global Scam Marketplace
The U.S. Secret Service has frozen $52.8 million in cryptocurrency connected to Xinbi Guarantee, a Chinese-language marketplace operating on Telegram that facilitates global fraud by selling tools to scammers.
The operation, conducted in collaboration with blockchain analytics firm Elliptic, successfully identified and froze the illicit funds. Elliptic stated in a release that it had been monitoring Xinbi and its associated wallet infrastructure for several years, and its intelligence was instrumental in enabling both the asset freeze and the sanctions imposed by the U.S. government.
The freeze, initiated at 8 a.m. UTC on September 8, targeted 52 wallets holding USDT, Tether’s dollar-pegged stablecoin. Under a warrant unsealed by the Department of Justice, two of these wallets, containing approximately $12 million, were seized outright. The remaining funds are frozen pending further legal action.
Xinbi operates as a guarantee marketplace, essentially an escrow system designed to foster trust among criminals. Vendors deposit cryptocurrency as collateral, assuring operators that they will receive their purchased goods, which can range from stolen personal data to money-laundering services. Buyers who feel defrauded can be reimbursed from these deposits, a mechanism that incentivizes criminals to use the platform rather than relying solely on mutual trust.
According to Elliptic, Xinbi and its merchants have processed at least $24 billion in transactions since 2022, making it the second-largest illicit online marketplace ever tracked. It surpassed Huione Guarantee, which processed $31 billion before being shut down by Telegram in May 2025 following years of exposure by Elliptic. This action followed a Treasury finding that Huione’s parent group was a primary money laundering concern, and Xinbi subsequently absorbed much of the displaced traffic.
A significant portion of the funds flowing through such platforms originates from “pig butchering” scams. In these schemes, perpetrators cultivate fake online relationships over extended periods before convincing victims to invest in fraudulent applications that display fabricated profits, ultimately leading to the draining of savings.
On September 9, the Treasury’s Office of Foreign Assets Control (OFAC) designated Xinbi as a transnational criminal organization, placing it in the same category as drug cartels. Two supporting firms, Singapore-based SafeW Technology and Cambodia-based Anwen Technology, were also sanctioned for their role in facilitating Xinbi’s operations. The United Kingdom had previously sanctioned Xinbi in March.
Xinbi has publicly condemned the asset freeze, calling it “arbitrary” and vowing to compensate its customers. The marketplace appears to be shifting its focus from USDT to USDD, a stablecoin launched by Tron founder Justin Sun, which claims to lack a central issuer capable of freezing wallets. Xinbi has reportedly already converted approximately $2.8 million of its remaining USDT into USDD via a decentralized exchange.
However, a potential complication arises from USDD’s reserves, which are partially backed by USDT. This means that the very asset Xinbi is attempting to evade could still pose a risk to its holdings.
Wednesday’s action was part of a broader effort by the DOJ’s Scam Center Strike Force. In a separate operation, agents were deployed to Madagascar to assist local authorities in dismantling 13 Chinese-run scam compounds. This operation resulted in the processing of evidence from nearly 400 arrestees and the seizure of over 3,200 devices. Since its inception in November 2025, the Scam Center Strike Force has seized approximately $938 million in cryptocurrency linked to scams, with Xinbi’s outstanding balance still under scrutiny.
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