Conduit Technology sues Tether over $2.76 million in USDT frozen without a police request
Conduit Technology sued Tether in New York over $2.76 million of USDT frozen from its treasury wallet in September 2025, which Conduit says Brazilian police never requested.
Why it matters
The case tests whether an issuer's undisclosed compliance criteria can justify a multi-month freeze of a company's working capital, and whether the issuer keeps the reserve interest earned on those tokens while access is denied. If Conduit prevails, other businesses that say a compliance sweep caught them wrongly have a route to challenge Tether freezes; Crypto News also reports that Conduit is not the only party litigating against Tether.
Where the sources disagree
Amount of USDT frozen
$2.76 million
Protos, The Defiant, Cointelegraph, Crypto.News, Crypto News (CryptoNews.net), The Daily Hodl
$2.8M
Protos, Cointelegraph, Bitcoin.com News
Some outlets round the frozen balance to $2.8 million in their headlines while the same reports and other outlets give $2.76 million.
Legal basis for the freeze
police did not identify Conduit's wallet for freezing
Protos, The Daily Hodl
Tether's current terms allow token freezes when it considers the action prudent or legally necessary
Crypto.News
Conduit's complaint cites Brazilian police confirmation that no freeze was requested, while Crypto.News notes Tether's current terms allow the issuer to freeze tokens when it considers the action prudent or legally necessary.
Key facts
Conduit Technology sued Tether in the US District Court for the Southern District of New York over $2.76 million of USDT that Tether froze from the company's treasury wallet.
2,760,000 USDDisputed figureReported by Protos
Tether froze the balance of Conduit's treasury wallet in September 2025 and the funds remained frozen for more than a year, according to Conduit.
2,760,000 USDReported by Protos
Conduit says Tether selected its treasury wallet on its own initiative, through the T3 Financial Crime Unit, based on criteria it has not disclosed.
Reported by Protos
Conduit says the Brazilian Federal Police confirmed they never identified or requested the freezing of its treasury wallet, and that a Brazilian criminal court found Conduit was not under investigation in the Onix matter.
Reported by Protos
The freeze is tied to a 2024 Brazilian Federal Police investigation into Onix Intermediações Ltda and Bull Intermediação de Negócios Ltda, and Conduit says Onix stopped using its platform in April 2025 while the treasury wallet was created in May 2025 and never held Onix funds.
Reported by Cointelegraph
Conduit's Fireblocks treasury wallet processed 4,427 transactions totalling over $1.1 billion across 78 counterparties before the freeze.
1,100,000,000 USDReported by The Daily Hodl
The suit names Tether Holdings, Tether International, Tether Operations and Tether Investments as defendants and seeks restored wallet access, at least $2.76 million in damages, punitive damages and reserve profits, with Bitcoin.com News reporting six claims in the filing.
2,760,000 USDDisputed figureReported by Bitcoin.com News
Tether had not publicly responded to the allegations as of October 7, and Bitcoin.com News said it sought comment from a Tether spokesperson without receiving a response.
Reported by Bitcoin.com News
What happened
Conduit Technology, a cross-border payments firm, sued Tether in the US District Court for the Southern District of New York over $2.76 million of USDT that Tether froze from Conduit's treasury wallet in September 2025 and that Conduit says has stayed locked for more than a year. The complaint says Tether acted on its own initiative, through the T3 Financial Crime Unit, using criteria it has not disclosed. Conduit states the Brazilian Federal Police opened a 2024 investigation into Onix Intermediações Ltda and Bull Intermediação de Negócios Ltda, confirmed they never asked Tether to freeze Conduit's wallet, and that a Brazilian criminal court found Conduit was not under investigation in the Onix matter; Conduit adds that Onix stopped using its platform in April 2025, before the treasury wallet was created in May 2025, and that the wallet never held Onix funds. Crypto.News reports that Tether's current terms permit token freezes when the issuer considers the action prudent or legally necessary, which is the power Conduit says was used against it. The case names Tether Holdings, Tether International, Tether Operations and Tether Investments, and seeks restored access, at least $2.76 million in damages, punitive damages and profits Tether earned on the reserves backing the frozen tokens; Bitcoin.com News reports the suit carries six claims. Tether had not publicly responded as of October 7, and Bitcoin.com News said a request for comment went unanswered; Conduit says the frozen wallet worked like its operating bank account and slowed client settlements.
How the story developed
- First report
First report by Protos
Conduit sues Tether over $2.8M USDT freeze
- Update
Protos reports Conduit Technology's lawsuit against Tether
Protos said the payments firm filed in New York on the previous day, accusing Tether of freezing $2.76 million of USDT and refusing to return it for over a year.
- Independent corroboration
Independently corroborated by The Defiant
Conduit Sues Tether Over $2.76 Million in Frozen USDT
- Update
Cointelegraph and Bitcoin.com News add complaint detail on the 2024 Brazilian police investigation
Both outlets reported that the freeze was connected to a Brazilian federal police investigation opened in 2024 into Bull Intermediação de Negócios and Onix, and that Conduit began holding USDt in May 2025.
- Official statement
Official statement from Bitcoin.com News
Conduit Sues Tether Over a $2.76M USDT Wallet Frozen for a Year
- Update
T3 Financial Crime Unit named as the unit that selected the address
Bitcoin.com News quoted the complaint saying Tether acted through its T3 Financial Crime Unit on its own private criteria, and reported that it reached out to a Tether spokesperson without a response.
- Update
Four Tether entities named as defendants and relief sought detailed
Crypto.News reported that the case names Tether Holdings, Tether International, Tether Operations and Tether Investments, and that Tether had not publicly responded as of October 7.
- Update
Brazilian court finding and Onix timeline added
Crypto News reported that a Brazilian court found Conduit was not under investigation in the Onix matter, that Onix stopped using Conduit's platform in April 2025, and that Tether and TRON run the joint T3 unit that supported Operation Lusocoin.
- Update
Fireblocks wallet volume figures published
The Daily Hodl reported that Conduit's Fireblocks USDT wallet processed 4,427 transactions totalling over $1.1 billion across 78 counterparties before the freeze.
How coverage built up
Independent sources over time, counted the way the consensus panel counts them: a republication of a wire story does not move the line.
- 6 Oct 2026, 18:56 UTC: Protos — 1 independent source, 1 reports
- 6 Oct 2026, 19:19 UTC: The Defiant — 2 independent sources, 2 reports
- 6 Oct 2026, 21:00 UTC: Cointelegraph — 3 independent sources, 3 reports
- 6 Oct 2026, 21:35 UTC: Bitcoin.com News, official — 4 independent sources, 4 reports
- 7 Oct 2026, 04:41 UTC: Crypto.News — 5 independent sources, 5 reports
- 7 Oct 2026, 04:43 UTC: Bitcoin Insider — 6 independent sources, 6 reports
- 7 Oct 2026, 11:45 UTC: The Daily Hodl — 7 independent sources, 8 reports
Affected entities
Also mentioned: Brazil, USD Coin, Circle, Ethereum, Tether Limited
Original sources
| Publisher | Report | Role | Published |
|---|---|---|---|
| Bitcoin.com News Company, official | Conduit Sues Tether Over a $2.76M USDT Wallet Frozen for a Year | Independent | |
| Protos Crypto media | Conduit sues Tether over $2.8M USDT freeze | Original | |
| Cointelegraph Crypto media | Conduit sues Tether over allegedly freezing $2.8M without explanation | Independent | |
| The Defiant Crypto media | Conduit Sues Tether Over $2.76 Million in Frozen USDT | Independent | |
| Crypto.News Crypto media | Conduit sues Tether over $2.76M frozen USDT | Independent | |
| The Daily Hodl Crypto media | Tether Is Facing Lawsuit Over Alleged $2,760,000 USDT Freeze Without Justification | Syndicated | |
| Bitcoin Insider Aggregator | Payments Firm Conduit Sues Tether Over $2.76 Million in Frozen USDT | Syndicated | |
| Crypto News (CryptoNews.net) Aggregator | Conduit sues Tether over $2.76 million USDT freeze as challenges mount | Syndicated |
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