Cross-border payments company Conduit Technology has sued stablecoin issuer Tether, alleging that Tether froze $2.76 million in USDt held in a company wallet and has not explained or reversed the action. The complaint says the freeze materially affected Conduit’s business and that the funds belong unequivocally to the company.
According to Cointelegraph, Conduit filed the case on Monday in the US District Court for the Southern District of New York. The company alleges that Tether had no legal entitlement to the funds and no claim over them.
What Conduit alleges
Conduit said it began holding USDt in its digital treasury wallet in May 2025. The company alleges that Tether froze the entire $2.76 million balance on Sept. 24, 2025, without justification.
The complaint says Conduit repeatedly requested that Tether restore access to the funds, but that the freeze remained in place as of Monday. Conduit argues that Tether should not be able to take or restrict access to business funds simply because they were stored in Tether’s stablecoin.
The lawsuit does not establish that Conduit’s allegations are true. Tether had not provided an immediate response when Cointelegraph sought comment.
Alleged connection to Brazilian investigation
According to the complaint, the freeze was linked to a Brazilian federal police investigation launched in 2024. That investigation involved financial intermediary Bull Intermediação de Negócios and Onix.
Conduit alleges that Tether independently identified the company’s treasury wallet as connected to those businesses, using its own criteria, and then froze the USDt. The source material does not state that Conduit was accused of wrongdoing in the Brazilian investigation.
The case highlights a central feature of stablecoins: although USDt is designed to track the US dollar, access to tokens can be restricted by the issuer in circumstances connected to investigations or suspected illicit activity. In this case, Conduit is challenging Tether’s authority to freeze the funds and the lack of an explanation it says it received.
Wider legal backdrop and market picture
The lawsuit follows a separate case filed about a month earlier by two Thai nationals. They alleged that Tether froze $42.4 million in USDt after an informal request from US Homeland Security Investigations. Those funds were allegedly connected to a $61 million “pig butchering” case in the US, in which a federal court issued a seizure warrant for the USDt in February.
The source also reported that Tether said it helped freeze $550 million in Iran-linked USDT this year, though no further details were provided in the material.
Moneyiar market data at 10:13-10:14 on Oct. 7, 2026, showed Tether USDt at $0.9996999096, up 0.02% over seven days and unchanged over 24 hours. Ethereum was trading at $2,586.2710736706, down 4.71% over 24 hours and 3.86% over seven days. Sui stood at $1.127873535, down 5.70% in 24 hours and 2.73% over seven days, while Plasma was at $0.0872940537, down 5.29% and 9.78% over those periods, respectively.
