Cross-border payments company Conduit has sued Tether in federal court over approximately $2.76 million in USDT that Conduit says has remained frozen for more than a year. The Block
The complaint was filed in the U.S. District Court for the Southern District of New York. Conduit alleges that its treasury wallet was frozen on September 24, 2025 and that Tether has not provided a substantive explanation for refusing to restore access.
Conduit links the dispute to a Brazilian investigation involving a former customer, Onix Intermediações. The company says Brazilian authorities did not identify Conduit’s treasury wallet for freezing and that the wallet was created after Onix stopped using Conduit’s platform. Those statements are allegations in Conduit’s complaint and have not been adjudicated. The Block
The payments firm is seeking access to the frozen USDT, at least $2.76 million in damages and additional relief. Tether had not publicly responded to the allegations at scan time. The Block
The case reaches beyond one wallet because centralized stablecoin issuers retain technical power to freeze tokens at specific addresses. That capability is routinely used in sanctions, hacks and law-enforcement investigations. Conduit’s lawsuit asks a court to examine the legal boundary around an issuer’s exercise of that power when the token holder disputes the basis for the freeze.
TOKEN RECON ASSESSMENT
The case is important because stablecoin censorship controls are usually discussed as a security or compliance feature. Here, a commercial holder is asking a federal court to define what legal authority and process must support a freeze.
Nothing in the filing establishes that Tether acted unlawfully. The next consequential evidence is Tether’s response and any court treatment of whether token terms, compliance obligations or other law authorized the freeze.
