Tether Accused of Illegally Freezing $42.4M in USDT at Government Request

Two Thai entrepreneurs have sued Tether in the US District Court for the Southern District of New York, alleging that the stablecoin issuer froze approximately $42.4 million in USDT without legal authority.

Nutthawat Rukthammachalern and Natthawat Kasamvilas claim that Tether added their Ethereum addresses to its blocklist at an informal request from a Homeland Security Investigations agent in October, without a warrant or court order.

A federal magistrate judge in North Carolina later issued a seizure warrant detailing plans for Tether to burn the restricted tokens, issue replacement USDT, and transfer them to a government-controlled wallet.

The plaintiffs argue that the warrant did not retroactively authorize the freeze or permit Tether to destroy the original tokens before a final confiscation judgment.