Mercado Bitcoin halts transfers as Tether freezes over 4.5M USDT

Mercado Bitcoin suspended deposits and withdrawals after identifying a security incident in one of its systems on November 2. The Brazilian crypto exchange later published destination wallet addresses to help trace assets connected to the incident.

Tether CEO Paolo Ardoino said the company froze over 4.5 million USDT connected to the case. It is amongst other security incidents concerning crypto services, including Binance and old BTCPay Server software users, in the last few days.

Mercado Bitcoin publishes addresses to trace funds

Mercado Bitcoin responded quickly after discovering the breach; they claim it occurred overnight and that customers were financially unaffected while no data was lost.

They are investigating, tracking, and coordinating with the relevant authorities; deposits and withdrawals were stopped.

Following this, in a separate address, Mercado Bitcoin issued details of the addresses used on other blockchains for its transfers, including Bitcoin, Solana, Stellar, Tron, and their Ethereum-based/compatible services. It claimed the addresses were being published purely for tracing purposes.

The exchange also said it was working to restore operations safely and would keep customers informed through official channels. But there was no update about the reopening time or total financial impact.

Tether blocks incident-linked tokens

Ardoino disclosed Tether’s intervention while sharing Mercado Bitcoin’s initial announcement.

“Tether froze more than 4.5M USDT related to this security incident,” he wrote.

Tether can block transfers of its tokens at specific addresses, helping restrict their movement during an investigation. This was the second time in the last seven days that Tether has frozen funds associated with exploits. The latest was with Binance, when over $6 billion was exploited.

Ardoino’s announcement left the next steps for those frozen tokens unspecified, including their possible return to Mercado Bitcoin.

Binance and BTCPay respond to recent thefts

The incident follows Binance’s disclosure that attackers stole approximately $6.3 billion from its wallets on October 29. Binance began reopening withdrawals on November 1 and committed to covering the losses.

BTCPay Server issued an advisory of their own on November 2 after receiving reports that Bitcoin and Litecoin were stolen from wallets that stored the spending keys on impacted servers.

They found web servers from version 2.4.1 or less were targeted, and the bad actors were also able to exploit a vulnerability that they patched in August through another method.

BTCPay recommends moving to fresh servers and moving existing wallet/seed to the new one, since updating the affected software might leave an open door for hackers.

The team added that wallets with their spending keys held outside the servers, like most hardware wallets, were unaffected by these thefts. It continues investigating the scope of the incident fully.

Final Summary

• Mercado Bitcoin stopped deposits and withdrawals and shared addresses to help trace assets.
• Tether’s CEO reported freezing over 4.5 million USDT as Binance and BTCPay addressed separate recent incidents.