Tether Sued Over USDT: Company Seeks Its Frozen Millions—and More
Payments company Conduit has sued Tether over $2.76 million in USDT it says it has been unable to access for more than a year, seeking not only the release of its funds but also at least the same amount in damages.
According to the complaint reported by The Block, Conduit filed suit in the U.S. District Court for the Southern District of New York on Monday, October 5. The company alleges that Tether froze the USDT in a wallet it uses for its operations, has not released the funds, and has not provided a reason.
Conduit, which facilitates money transfers in more than 100 countries using stablecoins such as USDT and USDC, says the wallet in question functioned as its operating bank account. The company argues that being unable to access the account has harmed its operations.
Claim that no police request was made
At the center of the dispute is an investigation in Brazil into Onix Intermediações, a former Conduit customer. Conduit says the freeze is connected to the investigation, but alleges that Brazil’s Federal Police did not request that its treasury wallet be frozen.
The company says law enforcement confirmed that it had made no such request and stated that it did not know why Tether had taken this step. It also says that a court in Brazil confirmed that Conduit was not a target of the Onix investigation.
The complaint states that Onix has not used the Conduit platform since April 2025, and that the disputed wallet was created about a month later. Conduit maintains that the wallet never held funds belonging to Onix.
Seeking damages and reserve earnings in addition to the return of funds
Conduit’s demand is not limited to the release of $2.76 million in USDT. The company is also seeking at least $2.76 million in damages, as well as earnings it alleges Tether made from reserves backing the frozen USDT.
This brings the combined demand for the return of the funds and minimum damages to $5.52 million. The alleged earnings from the reserves would be added to that amount; these demands do not yet represent a payment ordered by the court.