Conduit sues Tether in New York over frozen 2.76 million USDT

Cross-border payments firm Conduit Technology has filed a lawsuit against stablecoin issuer Tether in the US District Court for the Southern District of New York. Cointelegraph, Protos, and The Block reported that the lawsuit accuses Tether of freezing 2.76 million dollars in USDT without explanation. The complaint alleges that Tether had no legal entitlement or claim to the funds. [1][2][3][4][5]

According to Cointelegraph, Protos, and The Block, Tether froze the USDt in a Conduit treasury wallet in September 2025 and held the funds for over a year. Cointelegraph and Protos reported that the wallet freeze was tied to an investigation launched by Brazilian authorities in 2024. Protos added that Tether repeatedly referred Conduit to a contact in the Brazilian Federal Police without giving any context. [1][2][3][4]

Tether supports stablecoin variants pegged to assets such as the Mexican peso, Chinese offshore renminbi, and gold alongside its primary USD-pegged token. In 2021, Tether settled with the US Commodity Futures Trading Commission for 41 million dollars over misleading claims regarding its token reserves. [14]

Conduit claims that Tether ignored repeated requests to reverse the improper freeze. Protos reported that the lost working capital resulted in office closures and staff firings. The Defiant reported that Conduit is seeking a court order to restore access to its treasury wallet to resume client settlements. [3][7]