The payments company says its treasury wallet has been frozen for more than a year. Its New York lawsuit seeks restored access to the funds and damages.
Cross-border payments company Conduit Technology has sued four Tether group entities over its inability to access about $2.76 million in USDT. The complaint, filed in the Southern District of New York on October 5, seeks an order restoring access to its wallet and compensation for the harm the company alleges it suffered.
According to Conduit’s 17-page complaint, the dispute concerns working capital held separately from customer assets. The firm says it used its treasury wallet, holding the dollar-pegged stablecoin USDT, to support its operations and fund customers’ cross-border payments. The filing puts the wallet’s balance at approximately $2.76 million in USDT as of September 30, 2026.
The freeze dates back more than a year
Conduit alleges Tether froze the wallet on September 24, 2025, during a Brazilian Federal Police investigation involving companies named Bull and Onix. It argues that its own wallet was not among the addresses investigators sent to Tether for freezing.
The complaint acknowledges that Onix had previously used Conduit’s platform. But it says Onix’s last transaction took place on April 22, 2025, while the disputed treasury wallet was created on May 20. Conduit alleges the wallet never held Onix funds and says a Brazilian court acknowledged that it was not among the companies under investigation.
Conduit further alleges that Tether’s T3 Financial Crime Unit used its own criteria to select wallets for freezing. The payments firm says repeated requests, including a formal demand from its lawyers dated August 19, 2026, failed to restore access.
“Conduit owes no money to Tether and has no obligation to Tether.”
That statement in the complaint captures the company’s objection to the freeze. Conduit also alleges that losing access to working capital disrupted payment activity and forced it to lay off employees and close offices. These are the plaintiff’s claims.
What is Conduit asking the court to do?
The company wants access to the USDT restored or the funds returned. It also requests at least $2.76 million in compensatory damages, additional compensation for consequential losses, and the return of income allegedly earned on reserves backing the frozen tokens. None of those requested amounts is a court award.
Technical control and legal authority are separate questions. The dispute concerns the justification for exercising the issuer’s freeze powers over Conduit’s funds. Filing the complaint does not establish that Tether’s conduct was unlawful.
Cointelegraph reported on October 6 that it had sought Tether’s comment but had not received a response when its story was published. The complaint reviewed here contains neither Tether’s defense nor a judgment resolving the dispute.
Cointelegraph’s October 6 post on the Conduit–Tether lawsuit
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