Bitfinex and Tether have rejected allegations made in an amended consolidated class action lawsuit filed in the Southern District of New York. The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. According to the OAG, Bitfinex still isn’t saying whether any of the money might be returned to the exchange or its clients. … We’d also like to tell you about our mission and how you can help us fulfill it. Allegations that iFinex was not holding reserves to back Tether – a stablecoin is meant at least in theory to be backed by real assets to support its price — first emerged in January 2018 and the U.S. Commodity Futures Trading Commission reported to have launched an investigation. June 4, 2020 – Bitfinex, Tether, and their related entities today rejected blatantly false allegations made in an amended consolidated class action lawsuit filed in the Southern District of New York. The second Bitfinex/Tether lawsuit in six weeks The second class-action complaint was filed on Friday November 22 in the US District Court for the Western District of Washington. In December 2018 it was revealed that bank statements showed iFinex was holding adequate U.S. dollar reserves to back Tether, but then the company itself then admitted in April 2019 that it had dipped into Tether reserve funds to cover an $850 million loss, which then resulted in the lawsuit by New York State. Should it comply, the New York Attorney General has committed to bringing no charges against the company. The Office of the Attorney General (OAG) has said that Tether offered mixed messages as to how exactly USDT is backed. For the best experience, top crypto news at your fingertips and exclusive features download now. USDT is a stablecoin, which means it’s supposedly “pegged” to fiat currency. (Crypto advocates have, “We have been informed that these Crypto Capital amounts are not lost but have been, in fact, seized and safeguarded,” said Bitfinex in April 2019. The Attorney General has also mandated that Tether and Bitfinex include information about transfers of funds, along with “verification that Bitfinex and Tether have appropriately segregated client, reserve, and operational accounts.”. , and that the company share more information about what it did with the money. Bitfinex and sister company Tether caused more than $1 trillion in damages to the crypto market, a new lawsuit claims. Stuart Hoegner, General Counsel for Tether, said: “Even after taking three full months to amend their complaint, the plaintiffs’ allegations remain untethered to either […] Unlike many online publications, we don’t have a paywall or run banner advertising, because we want to keep our journalism open, without influence or the need to chase traffic.The journalism, reporting and commentary on SiliconANGLE — along with live, unscripted video from our Silicon Valley studio and globe-trotting video teams at theCUBE — take a lot of hard work, time and money. Stuart Hoegner, General Counsel for Bitfinex said the lawsuit claims causation due to a correlation between the USDT demand growth and BTC price surge. “We have been informed that these Crypto Capital amounts are not lost but have been, in fact, seized and safeguarded,” said Bitfinex in April 2019. According to Bitfinex, this “copycat” lawsuit is as equally flawed as the first one filed by Roche Freedman on October 6 . They argue that the lawsuit is a money grab attempt and its research relies on cherry-picked data. Presumably, a note from Bitfinex covered the shortfall. A new plaintiff against Tether and Bitfinex. The information that Bitfinex and Tether have settled the lawsuit with the NYAG is unbelievable bullish information for the crypto market. With the Taiwanese banks no longer an option, Tether allegedly put its money in a trust account at the Bank of Montreal under the name of its general counsel. The suit began 22 months ago in April 2019, when James and her office sued iFinex for allegedly using Tether’s USDT cryptocurrency to cover up $850 million in lost funds. Under the terms of the settlement, iFinex has agreed to pay a fine of $18.5 million in return for admitting no wrongdoing. The lawsuit also added more fuel to the longstanding theory that Tether created its tokens out of thin air, manipulating the Bitcoin price. 16 HOURS AGO, POLICY - BY MARIA DEUTSCHER . In the tweet he quotes a letter sent yesterday by the Office of the Attorney General (OAG) to Judge Cohen of the New York Supreme Court, requesting the immediate submission of the requested documentation to Bitfinex and Tether. Tether is a controversial cryptocurrency with tokens issued by Tether Limited. The NYAG accused Tether of lending Bitfinex $850 million to cover a loss. The lawsuit was filed in November last year and was part of a series of legal suits alleging market manipulation. has centered around whether each USDT is really backed 1-to-1 by fiat, as the company has previously claimed. The lawsuit claimed that Bitfinex and Tether engaged in “undisclosed, conflicted transactions to cover Bitfinex’s losses by transferring money out of Tether reserve funds.” The amount claimed to have been taken is at least $700 million, with Bitfinex trying to cover a loss of $850 million. Unlike many online publications, we don’t have a paywall or run banner advertising, because we want to keep our journalism open, without influence or the need to chase traffic. What do you think about Bitfinex having to … This was “misleading,” according to the findings; the bank statement, dated September 15, may have accurately reflected Tether’s balance, but "the $382,064,782 listed as cash reserves for tethers had only been placed in Tether’s account as of the very morning.”. They also must stop … The alleged fraud was claimed to have come via a relationship Bitfinex established with Crypto Capital Corp., a Panama-based payment processing firm that commingled client funds with its own capital. “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie. About a day later, it was revealed that several individuals have taken iFinex to court claiming that, with Tether, they single-handedly manipulated the entire cryptocurrency market, October 7, 2019. By mid- to late-2018, executives at Bitfinex and Tether suspected Crypto Capital had lost, stolen or absconded with the money, and they haven’t be … Tether and Bitfinex have had prior allegations of collusion and malpractice (namely, the April 2019 incident where it is alleged that Bitfinex used Tether to cover $850 million in losses), but still deny the claims of the lawsuit. Controversial cryptocurrency exchange Bitfinex and its sister stablecoin issuer Tether have had a lawsuit against them withdrawn by two plaintiffs and re-filed with the addition of a new plaintiff. So 1 USDT is always equivalent to 1 USD.” But Tether changed its tune in February 2019, claiming that each USDT is actually backed 100% by “reserves”—an ambiguous term that can include fiat currency, the company said, but may also involve “other assets and receivables from loans made by Tether to third parties.”. From 2014 until 2019, Tether’s line was the following: “Every tether is always backed 1-to-1, by traditional currency held in our reserves. Bitfinex Tether Lawsuit: Bitfinex is a leading and important cryptocurrency exchange that offers the major cryptocurrencies for trade and is a favorite spot for margin traders. For their part, Tether and Bitfinex have not had to admit to any of the wrongdoings outlined in the State’s eight pages of findings. The more subscribers we have, the more YouTube will suggest relevant enterprise and emerging technology content to you. The two companies were accused of creating “the largest bubble in human history” in a lawsuit filed in New York in October, which alleged that Bitfinex and Tether … This field is for validation purposes and should be left unchanged. The lawsuit has been hovering over the Bitcoin and crypto market like a Damocles sword for 22 months now. Despite tumultuous times in the cryptocurrency market, Tether, also known as USDT, was as of 9:30 p.m. EST trading where it should be: exactly $1.