Cross-border payments platform Conduit Technology filed a lawsuit in US District Court for the Southern District of New York on Monday, alleging stablecoin issuer Tether froze $2.76 million in USDt without explanation. Conduit stated Tether had "no legal entitlement" and "no claim" to the funds.
Conduit began holding USDt in its digital treasury wallet in May 2025. Tether froze the entire $2.76 million on Sept. 24, 2025, an action Conduit claims "materially impacted its business."
Conduit's lawsuit alleges the freeze connects to a Brazilian federal police investigation initiated in 2024 targeting the financial intermediary Bull Intermediação de Negócios and Onix. According to the complaint, Tether identified Conduit's treasury wallet as tied to these companies "on its own initiative using its own criteria." Conduit maintains the funds are "unequivocally Conduit's."
Conduit has repeatedly asked Tether to unfreeze the funds since September 2025. As of Monday, Tether had not complied.
The action follows another lawsuit filed about a month prior. Two Thai nationals sued Tether, alleging the stablecoin issuer froze $42.4 million in USDt after an "informal request" from US Homeland Security Investigations. Those funds were reportedly part of a $61 million pig butchering case. The US District Court for the Eastern District of North Carolina issued a seizure warrant for that USDt in February.
Tether has previously disclosed its role in freezing illicit funds. The company reported helping freeze $550 million in Iran-linked USDT earlier this year, demonstrating its active enforcement of compliance actions tied to its stablecoin.
