Tether has frozen more than $4.5 million in USDT connected to a security incident at Mercado Bitcoin, Brazil’s largest cryptocurrency exchange. The action followed the detection of irregular token movements that security researchers estimated at over $40 million across multiple blockchains.

Mercado Bitcoin reported identifying a compromise in one of its systems in the early hours of November 2. The exchange said it moved quickly to contain the issue, stating that no customer funds were lost and no user data was exposed. As a precaution, the platform suspended deposits and withdrawals while it continued its investigation and coordinated with Brazilian authorities.

Suspicious Transfers Across Multiple Networks

Blockchain security firm Hypernative identified abnormal activity beginning around 02:15 UTC, with several large transactions occurring between 06:19 and 06:53 UTC. The flagged movements involved assets on at least 10 networks, including Bitcoin, Ethereum, Solana, Tron, Polygon and Avalanche. Among the tokens tracked were roughly 2,852 ETH, 106 BTC and 10,700 SOL. The precise ownership of the wallets involved remained unclear at the time of reporting.

Mercado Bitcoin published a list of addresses linked to the incident spanning EVM-compatible chains, Bitcoin, Solana, Stellar and Tron. The disclosure was intended to support investigators and other parties tracking the movement of the assets. The exchange did not release detailed loss figures for individual addresses.

Tether’s freeze prevents the tokens from being transferred or exchanged, though the company has stated that it cannot itself return blocked assets to victims. Recovery decisions typically rest with law enforcement or judicial processes. Mercado Bitcoin confirmed it is working with authorities and monitoring the affected tokens. No public confirmation has emerged that the frozen USDT has been returned to the exchange.

Additional Freezes by Circle and Paxos

On-chain records show that Circle froze USDC on Polygon and Paxos froze gold-backed tokens on Ethereum in connection with the same incident. A researcher estimated the combined value of those actions at nearly $7 million. Separately, a wallet linked to the breach transferred approximately 2,800 ETH to another address.

The broader response by stablecoin issuers comes amid Tether’s ongoing work with U.S. authorities. As of October 31, that cooperation had covered more than 3,590 wallets involving about $1.6 billion in USDT. Tether has also reported freezing more than $7 billion in USDT across secondary-market addresses in total. In a separate recent case, the company froze more than $1.5 billion in USDT within 30 minutes after an October 29 incident at Binance that the FBI attributed to North Korean actors.

Mercado Bitcoin has maintained that customer assets remain secure and that operations were paused solely as a protective step. The exchange continues to investigate the full scope of the security event while deposits and withdrawals remain suspended.