EQIBank Freeze Exposes Tether's Offshore Holdings Risk

Tether’s funds are locked up at EQIBank, an offshore banking partner that now faces possible liquidation after a United States asset seizure.

The stablecoin issuer described the exposure as minimal, amounting to under 0.034% of its entire asset base. No exact dollar amount has been provided, nor has the company officially verified the report. The episode nonetheless casts doubt on what proportion of Tether’s reserves are held abroad.

Why EQIBank Is at Risk

The Information broke the news of the frozen funds. EQIBank, a Dominica-licensed digital bank, is trying to retrieve roughly $89 million that US authorities confiscated from accounts linked to Capstone Ltd, a payment processor.

According to EQIBank’s own court filing, the seized money was held at Wells Fargo and JPMorgan Chase. The confiscation amounted to about 80% of the bank’s entire cash reserves.

Dominica 'digital bank' EQIBank sued for 'securities fraud' in U.S. https://t.co/2SUoUXIOII #offshorealert

— OffshoreAlert (@OffshoreAlert) February 10, 2026

Because of the size of the seizure, EQIBank has cautioned that it may be forced into liquidation—the context in which Tether’s deposits were frozen.

The Real Question Is Concentration

The danger is not that one bank accounts for 0.034% of Tether’s holdings. What remains unknown is the total amount of Tether’s reserves parked in offshore institutions. That number would reveal the genuine risk, distinct from its holdings of US Treasuries and money market instruments.

Concentrating reserves in smaller banks has triggered bank runs in the past. Numerous US companies found their deposits inaccessible after the 2023 collapse of Silicon Valley Bank.

Tether’s reserve buffer has been declining, despite a clean audit in 2025. This prompts a further concern: whether the firm could withstand multiple simultaneous offshore disruptions of this kind.

The latest attestation for Tether shows total reserves near $190 billion, largely in US Treasuries. The portion attributable to offshore banks remains the unresolved question from this incident.

The legal battle over the frozen money is ongoing in California. Whether Tether chooses to detail its offshore exposure will determine if the matter remains a minor note.