A lawsuit has been filed in a New York district court by two entrepreneurs from Thailand against Tether. The core of the complaint is the blocking of $42.4 million in USDT stablecoins, which the issuer carried out in October 2025. The plaintiffs insist that the freeze occurred without an official warrant, based solely on an informal request from the U.S. Homeland Security Investigations (HSI).
In my assessment, this is one of the most telling cases in recent years, exposing a fundamental contradiction in the operations of the largest stablecoin issuer. On one hand, Tether positions itself as neutral infrastructure that obeys only the law. On the other, the company clearly accommodates U.S. law enforcement even before they formalize legally binding documents.
The context of the dispute is tied to a high-profile fraud case involving a "pig butchering" scheme, with damages amounting to $61 million. The plaintiffs do not deny that their funds may be linked to this scam, but they challenge the procedure. They point out that the warrant for asset seizure was issued by the Eastern District Court of North Carolina only in February 2026—that is, four months after the block.
From a formal standpoint, Tether violated the presumption of innocence and acted preemptively, relying on verbal agreements with authorities. But in reality, stablecoin issuers have long become tools of extrajudicial enforcement, especially when it comes to U.S. jurisdiction. This creates a dangerous precedent: if the court rules in favor of the plaintiffs, Tether will have to overhaul its entire compliance policy, which could impact USDT liquidity on the secondary market.
My verdict: the lawsuit is unlikely to lead to the unfreezing of funds—the connection to fraud is too evident. But it will force the industry to reflect on how legitimate the actions of issuers are when they operate in the gray zone between private law and state interests. For the market, this is a signal: even the largest players are not immune to legal risks, and trust in stablecoins depends not only on reserves but also on the transparency of procedures.