A US law firm is trying to redirect $344 million in frozen Tether linked to Iran to cover old court judgments. Gerstein Harrow LLP filed a motion this week asking a court to redistribute the USDT—currently locked up by the government—to claimants who won unrelated cases years or even decades ago.
The motion
The filing doesn't challenge the freeze itself. Instead, Gerstein Harrow wants the funds moved to a different pool: one that pays out creditors who have been chasing unpaid judgments for years. The law firm argues those claimants deserve the money more than the government does, though the court hasn't ruled yet.
The claimants
Gerstein Harrow represents clients holding judgments that date back decades. The exact names of those clients aren't in the public filing, but the firm says the judgments are unrelated to the Iran-linked Tether. The move is unusual—most forfeiture fights focus on the original owner, not third-party creditors.
The Iran link
The $344 million in USDT was frozen as part of a broader US government action against entities connected to Iran. Tether's role as a dollar-pegged stablecoin made it a target for seizure when authorities traced the funds. The stablecoins are sitting in government-controlled wallets while the legal battle unfolds.
A judge will decide whether to grant the motion. If approved, the funds would be distributed to Gerstein Harrow's clients instead of being forfeited to the state. The court hasn't set a hearing date yet, but the filing puts the ball in the government's court to respond.
