U.S. Disrupts Xinbi Guarantee Scam Marketplace, Freezes $52.8 Million in Crypto
The U.S. Department of Justice, in coordination with the Treasury Department's Office of Foreign Assets Control (OFAC), has disrupted the Xinbi Guarantee online marketplace, a platform facilitating scams targeting Americans. Approximately $52.8 million in cryptocurrency, primarily in USDT, has been frozen, and 13 scam centers in Madagascar have been dismantled. The Justice Department seized two cryptocurrency wallets and expanded its Scam Center Strike Force to target scam centers globally, leading to the repatriation of approximately 30 Chinese leaders involved in these operations. Xinbi Guarantee, previously operating under the guise of a legitimate marketplace, has shifted to using USDD to evade detection and freezing.
The U.S. Department of Justice (DoJ), in conjunction with the Treasury Department's Office of Foreign Assets Control (OFAC), has taken significant action against Xinbi Guarantee, an online marketplace facilitating scams targeting American victims. The DoJ announced coordinated actions aimed at dismantling the platform and seizing assets. Approximately $52.8 million in cryptocurrency, predominantly held in Tether’s USDT stablecoin, has been frozen from 52 wallets associated with Xinbi and its network of merchants.
Xinbi Guarantee has been used to support organized crime groups operating scam centers in Southeast Asia, which steal billions of dollars annually from American victims through ‘pig butchering’ romance scams and other fraudulent schemes. The platform acts as an intermediary, providing services such as creating custom scam investment websites and laundering funds obtained through wire fraud.
The Justice Department seized two cryptocurrency wallets holding approximately $12 million in funds. Furthermore, the Scam Center Strike Force has expanded its scope to target scam centers globally, resulting in the takedown of 13 scam centers in Madagascar. Approximately 30 Chinese leaders involved in these operations have been repatriated to China by the Chinese government.
Historically, all payments on Xinbi have been made in USDT, primarily on the TRON blockchain. Following the asset freeze, Xinbi has responded by switching to USDD (“Decentralized USD”), another stablecoin pegged to the U.S. Dollar. Elliptic, a blockchain analytics firm, noted that USDD lacks a central issuer and freezing capability, despite claims of decentralization, and remains vulnerable to freezing risk due to its partial collateralization with freezeable USDT. The U.K. sanctioned Xinbi earlier this year for selling cryptocurrency-based services to scam centers, including stolen personal data and satellite internet equipment.
Elliptic described these actions as a “severe setback” to the Guarantee marketplace ecosystem, stating that merchants and users will now operate with the knowledge that their wallets may be identified and frozen at any time, undermining the core mechanism of these marketplaces. The DoJ’s actions represent a significant effort to combat transnational organized crime and protect American citizens from financial exploitation.