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Bitfinex and Tether will pay millionaire fine for lawsuit in New York

The cryptocurrency exchange Bitfinex and its subsidiary Tether, responsible for the stablecoin USDT, reached an agreement with the New York Attorney General’s Office to pay a fine of 18.5 millions of dollars. The deal occurs after 2 years, during which time both companies were accused of illegally offering services, covering up operations and lying about the backing of the dollar-pegged currency.

Tether reported that neither they nor Bitfinex admitted to any infringement and that the penalty payment shows their “desire to put this matter behind us.” Regarding the alleged issuance of USDT without endorsement, the company said that no evidence was found on the subject and also on the alleged manipulation of the prices of cryptocurrencies.

“The agreement resolves the accusations about a loan Tether made to Bitfinex when Bitfinex encountered challenges accessing roughly $ 850 million in funds held by a payment processor in 2018. These developments are by now well known. The loan was made to guarantee the continuity of Bitfinex clients “, Tether highlighted through a statement.

According to Tether, the loan has already been paid in advance with interest and without affecting your ability to process exchanges. As expressed in the document, the company said that the call of the prosecutor’s office was that they should have made a better public disclosure about what happened.

Tether even thanked the prosecution staff for their “cooperation and professionalism”, while Bitfinex posted on its Twitter account that the “agreement shows our commitment to the future of the industry and to transparency” .

In order to offer more information about their operations to the researchers, Bitfinex and Tether provided in January more than two million pages and documents to the authorities. The data was requested by the Attorney General of the State of New York (NYSAG), according to a report released by CriptoNoticias.

Prosecutor’s Office in a confrontational tone against Bitfinex and Tether

Letitia James, Attorney General of the State of New York. Source: WBLS / wikipedia.org

Unlike the conciliatory tone shown by both companies in their messages, the position of the Attorney General of New York and prosecutor Letitia James is diametrically opposite . In the statement from the prosecution it is reported that the judicial process put an end to the illegal, fraudulent and deceptive activities of Bitfinex in New York. There is also talk of wanting to hide $ 850 million in losses worldwide.

“Tether’s claims that their virtual currency was fully backed by US dollars at all times was a lie. These companies were hiding the true risk that investors faced, “said the prosecution who also stressed that the operations of Bitfinex and Tether are prohibited in New York.

The entity pointed out that in 2017 Tether did not have access to banking and that it had no way to demonstrate the support of the stablecoin Tether. In addition, a series of bank transfers are described that the prosecution questioned about their legitimacy to verify the funds.

Currently, Tether maintains a capitalization that exceeds 34 billion dollars. According to CoinGecko records, the capitalization at the time of publishing this article is about 35.8 billion dollars, which makes it the fourth most important cryptocurrency behind bitcoin, ether and Binance Coin.

In April 2019, CriptoNoticias reported the lawsuit that the prosecution filed against Bitfinex and Tether. At that time, prosecutor James accused them of trading securities in New York without authorization. Three months later, the prosecutor presented 28 pieces of evidence against both companies.

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Sandra Loyd
Sandra is the Reporter working for World Weekly News. She loves to learn about the latest news from all around the world and share it with our readers.

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