Conduit Sues Tether Over $2.76 Million in Frozen USDT

Conduit Technology has filed a lawsuit against Tether in a New York federal court, seeking access to $2.76 million in frozen USDT. The company initiated legal action on October 5, 2026, alleging that Tether froze its treasury wallet on September 24, 2025, without providing any explanation. Conduit claims the wallet was used solely for working capital and was kept separate from customer transaction wallets.

The frozen wallet processed 4,427 transactions with 78 counterparties, generating over $1.1 billion in volume. Conduit argues that the freeze has negatively impacted its liquidity, reduced transaction activity, and led to layoffs. The company is seeking damages of at least $2.76 million and court intervention to restore access to the funds.

Conduit alleges that Tether's actions constitute conversion, unjust enrichment, breach of fiduciary duty, and computer fraud. The dispute is linked to a Brazilian criminal investigation, though Conduit maintains that its wallet was never identified as part of the investigation or ordered frozen by authorities.

As of the publication of the report, Tether had not responded to the lawsuit. The allegations remain unproven, and the court has yet to rule on the claims.