US Treasury Sanctions Iran-Linked Wallets, Tether Freezes $131 Million USDT

The U.S. Treasury has expanded sanctions tied to Iran’s central bank to include four cryptocurrency wallets, triggering another large-scale freeze of Tether (USDT) and underscoring how geopolitical risk is increasingly intersecting with market plumbing in digital assets.

According to a report from Odaily, the newly sanctioned wallets were linked to Iran’s central bank. In response, Tether froze roughly $131 million worth of USDT held in the addresses. The action brings the total amount of USDT frozen across the related wallet cluster to about $475 million, highlighting the operational power centralized stablecoin issuers retain through blacklist controls—an issue regulators and some market participants continue to debate as the industry pushes for broader adoption.

The sanctions-related development landed amid heightened tensions in the Middle East. Iran’s military claimed it carried out a drone strike targeting a U.S. troop deployment and logistics support center in Kuwait, according to Odaily. While the report did not independently verify the claim, the announcement added to an already fragile risk backdrop that has periodically spilled over into crypto sentiment, particularly around liquidity conditions and safe-haven narratives.

Regulatory pressure also intensified in Russia, where the government is expected to add a provision to the final version of a crypto regulation bill that would bar non-professional investors from purchasing foreign stablecoins, PANews reported, citing Bits.media. The draft reportedly introduces new concepts such as ‘foreign digital instruments’ and ‘foreign digital instruments without delivery,’ with collateral-backed stablecoins categorized under the latter. Under the proposal, qualified investors could buy foreign digital instruments, while non-qualified investors would be restricted to assets separately designated by the central bank.

Russia’s central bank had previously circulated a stablecoin regulatory framework in late June, calling for all transactions to be processed through state-controlled exchanges or licensed conversion points. Central bank governor Elvira Nabiullina has argued for caution on foreign stablecoins, pointing to the ability of issuers to freeze assets in user wallets—a concern reinforced by the latest Tether action.

In the U.S., Morgan Stanley’s ($MS) online brokerage platform E*TRADE has formally launched spot cryptocurrency trading, according to Business Wire. Eligible E*TRADE customers can now buy, sell, and hold Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) directly on the platform. Spot trading fees are set at 50 basis points, and asset transfer functionality is expected to roll out later this year. The move extends a broader push by major brokerages to capture retail demand while keeping activity within regulated rails, a trend that could reshape how mainstream investors access crypto exposure beyond ETFs.

ETF flows offered a mixed but still constructive signal for altcoin-related products. U.S. XRP spot ETFs recorded net inflows of $6.7847 million on July 16 ET, led by Bitwise and Franklin products, PANews reported citing SoSoValue data. Bitwise’s Bitwise XRP ETF (XRP) posted $4.406 million in net inflows, bringing cumulative net inflows to $498 million. Franklin’s Franklin XRP ETF (XRPZ) saw $2.3787 million in net inflows, with cumulative net inflows at $416 million. As of the report, total net assets across XRP spot ETFs were about $997 million, with a reported XRP net-asset ratio of 1.45% and cumulative net inflows of $1.486 billion.

U.S. Solana spot ETFs also attracted fresh demand on July 16 ET, logging net inflows of $1.6553 million. The inflows were concentrated entirely in Grayscale’s Grayscale Solana Trust (GSOL), which lifted its cumulative net inflows to roughly $109 million, according to the same SoSoValue dataset cited by PANews. Total net assets across SOL spot ETFs stood near $879 million, with a reported SOL net-asset ratio of 1.99% and cumulative net inflows of $1.137 billion.

Meanwhile, asset movement from major institutions drew market attention. Odaily reported that BlackRock ($BLK) withdrew approximately $87.29 million worth of Bitcoin and Ether from Coinbase Prime, moving 1,246 BTC (about $80.6 million) and 3,542 ETH (about $6.69 million). The purpose of the transfers was not disclosed, though such movements are often watched for signals tied to custody rebalancing, ETF-related operations, or internal treasury workflows.

Washington’s policy outlook remains uncertain. Watcher.Guru reported that President Trump met with U.S. senators in an effort to advance the ‘Crypto Clarity’ bill, but the legislation is still seen as unlikely to be signed into law within 2026. The bill aims to clarify regulatory standards for digital assets in the U.S., a key demand from both industry and institutional allocators seeking predictable compliance pathways.

Broader risk markets softened alongside crypto. U.S. equities closed lower on July 16 ET, with the Dow down 0.20%, the S&P 500 down 0.50%, and the Nasdaq dropping 1.62%, according to pricing cited via Bybit. Crypto-related equities also fell, with Coinbase ($COIN) down 4.04% and Robinhood ($HOOD) down 8.27%.

Bitcoin briefly slid below $64,000, and was trading around $63,985, down 1.43% over the past 24 hours, according to OKX pricing cited by Odaily. The day’s developments—sanctions enforcement on crypto wallets, stablecoin policy tightening abroad, and uneven risk appetite—reinforced a central 2026 theme: market structure and regulation are increasingly driving short-term dynamics, even as adoption continues to widen through brokerages and ETF channels.