TL;DR:
- Victims of terrorist attacks linked to Iran filed a motion in a Manhattan court seeking the transfer of $344 million in USDT frozen by Tether.
- The motion seeks to enforce judgments totaling approximately $2.420 billion, demanding the company cancel two addresses linked to the IRGC and reissue the equivalent amount.
- Plaintiffs argue that Tether has the technical capacity and legal obligation to transfer the funds, citing precedents from other court orders.
A group of creditors holding terrorism judgments in the United States filed a motion before the Federal Court of the Southern District of New York to compel Tether to transfer more than $344 million in frozen USDT held in addresses blocked by the Office of Foreign Assets Control (OFAC), attributed to the Islamic Revolutionary Guard Corps (IRGC) of Iran.
The motion argues that the company has both the technological capacity and the legal obligation under New York transfer law and federal anti-terrorism enforcement statutes to cancel the balances linked to the IRGC and reissue an equivalent amount in new USDT to a wallet designated by the plaintiffs.
Precedents That Complicate Tether’s Defense
The document cites two cases that undermine any argument of operational incapacity on the firm’s part. In November 2025, in a case in the District of Columbia, the FBI delivered to Tether a seizure order dated March 19, 2025, and the company transferred the equivalent amount in USDT to the United States government. In a second case from Ohio, dated April 25, 2025, Tether “burned” tokens from a target address and reissued 4,340,000 USDT to a wallet controlled by authorities.
Tether froze the wallets in question on April 24, the same day OFAC added them to its Specially Designated Nationals list. The plaintiffs argue that the court can exercise personal jurisdiction over the company because the Salvadoran firm’s reserves are mostly custodied and managed in New York through Cantor Fitzgerald.
The measure does not target the firm’s own corporate assets but rather specific Iranian-owned interests under its custody. In total, the plaintiffs seek to enforce judgments amounting to approximately $552.3 million in compensatory damages and $1.860 billion in punitive damages, handed down over more than two decades across multiple federal terrorism-related cases.
