Thai businessmen sue Tether over freezing $42M in $61M pig butchering case
Two Thai businessmen have filed a lawsuit against stablecoin issuer Tether in a New York district court, alleging Tether illegally froze $42.4 million in USDT in October 2025. The case is part of a larger $61 million pig butchering scam investigation. The plaintiffs challenge Tether’s authority to freeze assets and seek the funds’ unfreezing alongside potential damages.
Case Background and Freezing of Funds
The plaintiffs claim that Tether froze $42.4 million in USDT without a court warrant in October 2025, acting on an informal request from U.S. Homeland Security Investigations.
A formal seizure warrant was only issued in February 2026 by the Eastern District of North Carolina as part of a $61 million pig butchering scam case. The warrant ordered the burning and reissuance of the tokens to a government-controlled wallet.
Plaintiffs’ Position and Legal Dispute
The plaintiffs do not deny involvement in the investment scam but contest Tether’s authority to freeze their funds absent a court order.
Corporate attorney Ariel Givner explained that the complaint does not dispute the government’s claim that the coins are illicit proceeds, but highlights that Tether initially froze secondary market holders’ tokens and earned treasury yield on reserves before receiving the warrant, which, according to the plaintiffs, does not authorize a private stablecoin issuer to freeze or burn tokens.
Case Context and Related Sentencing
The lawsuit arises from a widespread pig butchering investment fraud scheme, where victims are defrauded via elaborate scams.
In a separate February 2026 case, a US court sentenced a dual citizen of China and St. Kitts and Nevis to 20 years imprisonment for orchestrating a $73 million pig butchering fraud.
Why it matters
This lawsuit raises a crucial legal issue concerning the jurisdiction and authority of stablecoin issuers like Tether to freeze and manage user crypto assets without judicial oversight. As investment frauds involving cryptocurrencies grow in scale and complexity, clarifying issuers’ rights and responsibilities is key to combating crime, protecting investor rights, and regulating digital assets effectively.
Prepared from the source material with AI-assisted editing and checked against the supplied facts.
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