Stablecoin issuer Tether deposits of more than $1 billion with a financial services firm are at the center of a legal battle in London's High Court, the Financial Times reported on Tuesday.

Tether deposited the funds with a subsidiary of investment bank Britannia Financial, according to the report, which cited filings made in the High Court.

Britannia Financial is engaged in a legal dispute with British Virgin Islands-registered Arbitral International, which alleges that Britannia failed to pay the full price for a Bahamas brokerage it bought from Arbitral in June 2021.

Arbitral says it is entitled to extra money from assets generated by the business in the year following the sale, according to an agreement between the two firms. According to the report, Britannia claims that Tether deposited the funds with its subsidiary, Britannia Global Markets, and the transaction is therefore unrelated to the brokerage it bought from Arbitral.

Tether's USDT is the world's largest stablecoin, providing crypto users with a hedge against the volatility that often besets cryptocurrencies. Tether's $86.4 billion worth of assets are mostly deposited in U.S. Treasuries. The assets also include $5.2 billion worth of secured loans.

Tether did not immediately respond to CoinDesk's request for comment.

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