TL;DR
- Freeze Dispute: Plaintiffs say Tether froze 42.4M USDT months before a warrant and acted on an informal request.
- Legal Demands: Lawsuit seeks removal of blacklisted addresses, prevention of token destruction, and damages tied to Tether’s reserve income.
- Federal Probe Link: Funds are connected to a Justice Department investigation into $61M in USDT tied to pig‑butchering scams, with the Issuer assisting authorities in asset recovery.
Two Thai businessmen have taken legal action against Tether, claiming the stablecoin issuer froze 42.4 million USDT months before U.S. authorities secured a seizure warrant. Their lawsuit, filed Aug. 31 in the U.S. District Court for the Southern District of New York, argues that Tether acted without proper legal authority and deprived them of access to assets they say were obtained through routine business dealings.
Dispute Over Timing And Authority
According to the complaint, Nutthawat Rukthammachalern and Natthawat Kasamvilas allege Tether froze the tokens across 10 Ethereum addresses on Oct. 30, 2025. They say the action stemmed from an informal request by a U.S. law enforcement agent, months before a warrant was issued on Feb. 19. The plaintiffs emphasize they had no direct relationship with Tether and acquired the USDT through secondary‑market transactions, arguing the freeze amounted to an improper intervention into privately held digital assets.
The lawsuit asks the court to order Tether to remove the addresses from its blacklist and prevent the company from destroying the frozen tokens or issuing replacements to a government‑controlled wallet before any final forfeiture ruling. They also seek damages and the return of interest or income Tether allegedly earned from reserves backing the frozen USDT. Their claims include conversion, trespass to chattels and unjust enrichment.
Connection To A Larger Federal Investigation
The frozen funds appear linked to a wider Justice Department probe involving more than $61 million in USDT that prosecutors say was stolen through pig‑butchering scams. Victims were allegedly guided to fake investment platforms, then their funds were moved through multiple wallets before landing in addresses tied to the investigation. Authorities credited Tether with assisting in the transfer of seized assets. At the same time, the company described the effort as a recovery operation supported by its team.
The lawsuit raises questions about whether Tether can freeze tokens held in private wallets before a warrant is issued, and whether a later warrant allows the company to destroy those tokens before a court determines they can be forfeited. Neither the businessmen’s ownership claims nor the government’s allegations have been resolved, leaving the fate of the disputed USDT in the hands of the court.
