TLDR
- A lawsuit was filed Monday by Conduit Technology against Tether in New York’s federal court.
- The payment platform alleges Tether locked $2.76 million in USDT without justification in September 2025.
- The action appears connected to a Brazilian criminal probe involving Onix Intermediações, once a Conduit client.
- According to Conduit, Brazilian authorities confirmed the wallet was never targeted and no investigation involved the company.
- The legal filing demands return of the frozen assets along with an equal amount in compensatory damages.
A federal lawsuit filed by Conduit Technology targets stablecoin giant Tether over allegations the firm froze $2.76 million in USDT assets without providing any rationale.
The legal action was initiated Monday in the US District Court for the Southern District of New York. According to Conduit, access to these funds has been blocked for more than twelve months.
Operating as a cross-border payment solution provider, Conduit leverages stablecoins such as USDT and Circle’s USDC to facilitate transactions spanning over 100 nations worldwide.
According to court documents, the frozen wallet functioned as the company’s primary treasury account. The loss of access has significantly disrupted routine business activities, the filing explains.
Core Allegations in the Legal Filing
The complaint states Conduit started maintaining USDT holdings in a digital treasury wallet beginning in May 2025. On September 24, 2025, Tether allegedly froze the entire $2.76 million balance.
Court documents assert Conduit has “no legal entitlement” and “no claim” connected to any illegal activity. The filing emphasizes Tether has failed to provide adequate justification for the freeze.
“Conduit owes no money to Tether and has no obligation to Tether,” states the legal complaint. The company claims multiple attempts to secure release of the funds have been unsuccessful.
The freeze appears tied to a 2024 criminal investigation conducted by Brazilian federal authorities. That inquiry targeted Bull Intermediação de Negócios and another entity called Onix Intermediações.
According to the lawsuit, Onix previously maintained a customer relationship with Conduit but ceased platform usage in April 2025—roughly one month before the disputed treasury wallet was established.
Legal documents indicate Brazilian law enforcement verified that Conduit’s wallet was never subject to a freeze order. Furthermore, a Brazilian court allegedly confirmed the payment platform was not targeted in the Onix investigation.
The complaint contends Tether implemented the freeze “on its own initiative using its own criteria.” According to Conduit, no formal legal order specifically naming the company was ever issued.
Similar Cases Involving Frozen Tether Assets
This legal action represents the second recent lawsuit challenging Tether’s freezing practices. Approximately one month prior, two individuals from Thailand filed suit over a different freeze incident.
In that matter, Tether allegedly locked $42.4 million in USDT following what plaintiffs described as an unofficial request from US Homeland Security Investigations.
That particular freeze related to a $61 million pig butchering fraud case filed in North Carolina’s Eastern District. Authorities issued a seizure warrant for those funds in February.
While Conduit’s legal filing does not mention that lawsuit, both cases present comparable allegations regarding Tether freezing customer assets without explicit legal authorization.
Conduit’s complaint argues that Tether continues generating interest income on reserves backing the frozen stablecoins. This arrangement allows Tether to profit while Conduit’s capital remains inaccessible, the company contends.
The legal petition requests court intervention to compel Tether to unlock the $2.76 million in frozen USDT. Additionally, Conduit seeks $2.76 million in compensatory damages and alleged profits earned by Tether.
Cointelegraph contacted Tether requesting comment on the legal proceedings. As of Monday, Tether had not released any public statement regarding the lawsuit.
The matter now sits before the Southern District of New York. Court officials have not yet scheduled a hearing date.
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