Tether Blocks 42 Million USDT Before Court Ruling

Two Thai traders have filed a lawsuit against Tether, claiming that the company blocked 42.4 million USDT more than three months prior to a court ruling. This case could clarify the extent of the issuer's control over user assets for the largest stablecoin in the market. According to the complaint filed in the Manhattan federal court, 42,417,785 Tether tokens were blacklisted on October 30, 2025, across 10 Ethereum addresses. The plaintiffs allege that this action was taken at the informal request of U.S. law enforcement, and at that time, there was no seizure order or court directive in place. The seizure order related to these assets was eventually issued on February 19, 2026, in North Carolina. This case is connected to investigations into fraud schemes known as "pig butchering." The U.S. Department of Justice reported five days after the seizure of over 61 million dollars in Tether linked to this network. The plaintiffs state that they purchased these USDTs through secondary market transactions and had no direct relationship with Tether. They have requested the court to remove the addresses from the blacklist and for Tether not to burn the tokens or transfer their equivalent to a government wallet until a final ruling is made. Tether has dismissed the lawsuit as baseless, stating that its cooperation with the Department of Justice is part of its efforts to prevent the criminal use of USDT. The plaintiffs' claims have yet to be proven.

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