TLDR
- Conduit Technology filed a lawsuit against Tether in a New York federal court on Monday.
- Conduit says Tether froze $2.76 million of its USDT in September 2025 with no explanation.
- The freeze is tied to a Brazilian investigation into Onix Intermediações, a former Conduit customer.
- Conduit claims police confirmed its wallet was never flagged and it was not under investigation.
- The lawsuit asks for the frozen funds back plus $2.76 million in additional damages.
Conduit Technology has filed a lawsuit against stablecoin issuer Tether. The company says Tether froze $2.76 million of its USDT funds and has not explained why.
⚡️JUST IN: Tether is being sued over a $2.76 MILLION USDT freeze.
Conduit says the funds, used like an operating bank account, have been LOCKED for over a year despite Brazilian authorities not ordering the freeze.
It wants the $2.76 MILLION back plus another $2.76 MILLION in… pic.twitter.com/tNaU7MDAJX
— Coin Bureau (@coinbureau) October 6, 2026
The complaint was filed in the US District Court for the Southern District of New York on Monday. Conduit says it has been locked out of the funds for more than a year.
Conduit is a cross-border payments platform. It uses stablecoins, including USDT and Circle’s USDC, to move money across more than 100 countries.
The company says the frozen wallet acted like its main operating account. Losing access to it has hurt daily business operations, according to the filing.
What the Lawsuit Claims
Conduit says it began holding USDT in a digital treasury wallet starting in May 2025. Tether froze all $2.76 million in that wallet on September 24, 2025.
The filing states Conduit has “no legal entitlement” and “no claim” tied to any wrongdoing. It says Tether has not given a clear reason for the freeze.
“Conduit owes no money to Tether and has no obligation to Tether,” the complaint reads. Conduit says it repeatedly asked Tether to release the funds, without success.
The freeze is linked to a 2024 investigation by Brazilian federal police. That probe involved a financial firm called Bull Intermediação de Negócios and a company named Onix Intermediações.
Conduit says Onix was a former customer but stopped using its platform in April 2025. That was about a month before the treasury wallet in question was even created.
The lawsuit states that Brazilian law enforcement confirmed Conduit’s wallet was never flagged for freezing. It also says a Brazilian court confirmed Conduit was not under investigation in the Onix case.
Conduit argues Tether froze the wallet “on its own initiative using its own criteria.” The company says this decision was made without any formal order tied to Conduit itself.
A Pattern of Tether Freezes
This is not the only recent case involving frozen Tether funds. About a month earlier, two Thai nationals sued Tether over a separate freeze.
In that case, Tether allegedly froze $42.4 million in USDT. The action followed what the plaintiffs called an informal request from US Homeland Security Investigations.
That freeze was connected to a $61 million pig butchering scam case filed in the Eastern District of North Carolina. A seizure warrant for the funds was issued in February.
Conduit’s lawsuit does not reference that case directly. But both lawsuits raise similar claims about Tether freezing user funds without a clear legal order.
In its complaint, Conduit says Tether continues to earn interest on the reserves backing the frozen stablecoins. The company argues this means Tether is profiting while Conduit’s funds stay locked.
The lawsuit asks the court to order Tether to release the $2.76 million in frozen USDT. It also asks for an additional $2.76 million in damages and profits Tether allegedly earned.
Cointelegraph reached out to Tether for comment on the lawsuit. Tether had not issued a public response as of Monday.
The case is now before the Southern District of New York. No hearing date has been set yet.
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