I was wondering what the behavior of the Freeze functionality would be like when dealing with a smart contract address. For example (hypothetically), if a customer was defrauded of an ASA and gets into contact with the asset issuer (who is in charge of the freeze address), but the fraudster has already transferred the balance into a smart contract address (e.g. a liquidity pool). Would issuing an asset freeze transaction freeze all the balance of that particular asset in that smart contract address?
Is there any other possibility to deal with a situation like this? (I don’t think it’s possible for the developer of the contract roll back that transaction nor track the balance as it goes through the smart contract; but maybe that’s possible or there’s a better way to handle this)