Tether & Bitfinex Settled With New York AG for $18.5 Million Fine

Tether and Bitfinex signed a deal with the New York Attorney General’s office to settle a long-standing legal conflict with a $18.5 million penalty. With this agreement Bitfinex and Tether requires to discontinue any trading activity with New Yorkers. In addition, these companies must submit regular reports to the OAG (Office of the Attorney General) to ensure compliance with this prohibition.

To resolve its financial difficulties with Crypto Capital, Bitfinex borrowed hundreds of millions of dollars from Tether to cover up the apparent loss of $850 million of commingled client and corporate funds. The New York Attorney General’s Office opened an investigation to determine if there was an irregularity in the contract that happened in April 2019. Tether and Bitfinex, a popular digital currency exchange is owned by Ifinex.

New York Attorney General Letitia James said in a statement, “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie. These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system. This resolution makes clear that those trading virtual currencies in New York state who think they can avoid our laws cannot and will not. Last week, we sued to shut down Coinseed for its fraudulent conduct. This week, we’re taking action to end Bitfinex and Tether’s illegal activities in New York. These legal actions send a clear message that we will stand up to corporate greed whether it comes out of a traditional bank, a virtual currency trading platform, or any other type of financial institution.”

Tether and Bitfinex declined to admit any misconduct but said “we share the objective of increasing transparency by the Attorney General.” As per CoinMarketCap, there are currently around 34 billion tether tokens in circulation with $34.7 billion market capitalization.



Join our community to stay on top of the latest insights about blockchain, digital & cryptocurrency news, risk and opportunities. Pre-registration available!

Image: QuinceCreative and Gerd Altmann

*Disclaimer: Fyggex, does not give any guidance, advice or recommendations to neither invest or not in any available normal currency or digital currency directly or indirectly via any trading platform, exchange or provider. Our sole purpose is to make you aware of the related real or potential risks and opportunities so that you can make your own research prior to any financial decisions you may want to take. Past performance and position are not a guarantee of risk-free future returns.