Tether froze $42M in USDT without a court order

Tether began freezing USDT without an order or court decision

Two businessmen from Thailand filed a lawsuit against the stablecoin issuer in the Southern District of New York. The company blocked $42.4 million in USDT across ten addresses on the Ethereum network. The freeze occurred on October 30, 2025.

Authorities only obtained a seizure warrant on February 19 — more than three months after the funds were frozen. According to the plaintiffs, the immobilization of funds was sufficient for an informal request from a single law enforcement agent. The procedure was violated: no court decisions or official warrants existed at the time of the freeze.

The plaintiffs claim they bought USDT on the secondary market and were never Tether clients. There is no contract between them and the company that would allow the issuer to touch their tokens. The businessmen demand that the addresses be removed from the blacklist and prohibit the burning of frozen coins.

Also, the plaintiffs ask to issue a replacement to the government wallet until the court decides. They demand the return of income that the issuer earned on reserves for these tokens. The money surfaces in the US Department of Justice case involving $61 million extorted through fake romantic encounters and fraudulent investment platforms.

A stablecoin in your wallet is not your money, but a line in the issuer's database that can be extinguished remotely by phone call