Arbitrum Cryptocurrency Seizure Case Lawyer Strikes Again, Seeks Court Order for Tether to Surrender $344 million

BlockBeats News, May 15th, according to court documents, Charles Gerstein, the lead attorney in the Arbitrum cryptocurrency seizure case, recently filed a motion with a federal court requesting that Tether Corporation transfer approximately $344 million worth of frozen USDT to victims holding an unpaid terrorism judgment. This batch of USDT was previously frozen due to its association with the Iran Islamic Revolutionary Guard Corps (IRGC) sanctioned by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC). Gerstein argues that Tether should use these frozen assets to satisfy a long-unpaid judgment against Iran.

This legal strategy was previously employed by Gerstein in an Arbitrum case related to North Korea, targeting cryptocurrency platforms that can freeze, control, or redirect digital assets to seek enforcement of unpaid judgments by clients. Unlike that case, the ownership issue this time is more direct, as OFAC has already designated the relevant wallets as IRGC assets, leading the plaintiffs to believe that the frozen USDT has become frozen property of a state supporting terrorism, enforceable under federal law.

Gerstein's core idea is becoming increasingly clear; if the cryptocurrency infrastructure can freeze sanctioned assets, the court could eventually rule that the same system could be used to transfer assets to victims holding enforceable judgments.