Conduit is suing Tether for damages after $USDT got frozen in their treasury wallet
What happened:
- Tether froze Conduit's wallet in Sept 2025
- Reason: Brazilian police investigation tied to ex-customer Onix Intermediações
- Case filed in US federal court (NY)
This is the centralization risk everyone warns about but few actually price in. Your stablecoin issuer can freeze your funds based on third-party investigations—even if YOU didn't do anything wrong
Conduit wasn't the target. They just had the wrong customer at the wrong time
Risk reminder: $USDT $USDC and most stablecoins are NOT permissionless. They're IOUs with a freeze button
If you're holding serious size or running treasury ops, you need legal clarity on custody risk and counterparty exposure. This case could set precedent on liability when issuers freeze innocent parties
What happened:
- Tether froze Conduit's wallet in Sept 2025
- Reason: Brazilian police investigation tied to ex-customer Onix Intermediações
- Case filed in US federal court (NY)
This is the centralization risk everyone warns about but few actually price in. Your stablecoin issuer can freeze your funds based on third-party investigations—even if YOU didn't do anything wrong
Conduit wasn't the target. They just had the wrong customer at the wrong time
Risk reminder: $USDT $USDC and most stablecoins are NOT permissionless. They're IOUs with a freeze button
If you're holding serious size or running treasury ops, you need legal clarity on custody risk and counterparty exposure. This case could set precedent on liability when issuers freeze innocent parties
