Tether Sued Over Freeze of $42.4M Stablecoin Holdings

Tether is facing a new lawsuit related to its freeze of 42.4 million USDT stablecoins in October last year.

The lawsuit, filed by Thai businessmen Nutthawat Rukthammachalern and Natthawat Kasamvilas in federal court on August 31, alleges that Tether improperly froze the funds months before a seizure warrant was granted to United States authorities in February of this year.

Tether claims it has the capability to block USDT owners from transferring or accessing their tokens and can even 'burn' them at will, contradicting its own statements about USDT being 'stable, fully backed, and freely transferable.'

The plaintiffs are seeking a court order to have Tether remove their addresses from its blacklist and prevent the company from destroying the frozen tokens. They also want the company to issue replacements to a government-controlled wallet before a final forfeiture decision.

Tether has dismissed the lawsuit as 'baseless' and claims it is working with global law enforcement, including the Department of Justice, to prevent unlawful use of USDT.