Tether Faces Lawsuit Over $2.76M Stablecoin Freeze

This report is based on information published by decrypt.co. A payments firm has filed a lawsuit over Tether’s freezing of a treasury wallet tied to $2.76 million in stablecoins.

According to the report, the firm says Tether froze the wallet on its own initiative because of a Brazilian investigation that the firm says it has no connection to. The firm also alleges that Tether has profited from the reserves while refusing to release the funds for more than a year.

✦Key Takeaways

• ✓A payments firm says Tether froze its treasury wallet holding $2.76 million in stablecoins.
• ✓The firm alleges the freeze was linked to a Brazilian investigation it says it is not connected to.
• ✓The firm says Tether has kept the funds frozen for more than a year while profiting from the reserves.

✦Context

Stablecoin issuers can freeze tokens or associated wallets in some cases, depending on their policies and technical controls. Disputes over frozen funds can raise questions about access, custody and the scope of issuer authority.