Tether Sued Over $42.4M USDT Freeze Before Warrant

Two Thai businessmen have filed a lawsuit against Tether over a $42.4 million USDT freeze, alleging that the stablecoin issuer blacklisted their wallets months before U.S. authorities obtained a seizure warrant.

Nutthawat Rukthammachalern and Natthawat Kasamvilas filed the complaint on August 31 in the U.S. District Court for the Southern District of New York, challenging whether Tether had the legal authority to freeze the tokens after an informal request from U.S. investigators.

The plaintiffs argue that Tether blacklisted 10 Ethereum addresses containing 42,417,785.62 USDT on October 30, 2025, and directed them to a Homeland Security Investigations (HSI) special agent without providing a warrant or other legal process supporting the freeze at the time.

The seizure warrant was subsequently issued by a magistrate judge in the Eastern District of North Carolina on February 19, 2026, directing the frozen USDT to be burned and equivalent tokens reissued to a government-controlled wallet.