Tether Sued by Conduit Over $2.76 Million USDT Freeze

Cross-border payments company Conduit sued Tether in the U.S. District Court for the Southern District of New York, alleging the stablecoin issuer froze $2.76 million of its funds without justification and refused to release the money for more than a year. Conduit said Tether froze its treasury wallet on Sept. 24, 2025, and has since profited from reserves backing the tokens. The complaint brings claims including conversion, unjust enrichment, breach of fiduciary duty and computer fraud, and demands the funds be returned. Conduit said the freeze stemmed from a Brazilian Federal Police probe into entities tied to a firm called Onix, which had used its platform. Conduit said the wallet was created in May 2025, nearly a month after Onix's last transaction, and never held Onix funds. The wallet processed more than $1.1 billion in volume before being locked, forcing layoffs and office closures, Conduit said. The case adds to scrutiny of Tether's freeze powers. Tether was separately sued over a $42.4 million freeze, and Sen. Richard Blumenthal recently called USDT a sanctions-evasion "superhighway."