12 October 2026
DOJ Freezes $84 Million from Tether-Connected Payment Processor Capstone Amid Regulatory Scrutiny
The U.S. Department of Justice (DOJ) has taken significant action by seizing $84 million from Capstone, a payment processor closely associated with Tether, the largest stablecoin issuer. This move comes in light of allegations that Capstone facilitated unauthorized transactions for Tether and Bitfinex, raising serious concerns about compliance within the crypto banking sector.
Capstone, based in Montana, is accused of operating without the necessary licenses, presenting itself as an IT services provider while allegedly managing payments for Tether and Bitfinex. The DOJ's seizure involved funds held in accounts at major banks, including Wells Fargo and JPMorgan Chase, highlighting the ongoing challenges crypto firms face in securing reliable banking relationships.
According to reports, Capstone processed over $700 million through U.S. banks, with a significant portion of these transactions linked to Tether and Bitfinex. Notably, the funds frozen represent a substantial percentage of EQIBank's total assets, prompting the bank to warn of potential liquidation.
In addition to the financial implications, Capstone has been implicated in converting stolen funds from elder fraud schemes into stablecoins, further complicating Tether's position. While Tether and Bitfinex have acknowledged their relationship with EQIBank, they have denied any wrongdoing related to Capstone's operations.
This incident underscores the persistent regulatory hurdles that cryptocurrency companies encounter, even as they seek to establish legitimate banking connections. The seizure serves as a stark reminder of the complexities involved in navigating the evolving landscape of crypto finance.
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