The settlement document can be found here. The New York Attorney General’s Office alleges that Bitfinex and Tether failed to disclose losses amounting to $850 million and deceived clients and markets by overstating reserves. Under the terms of the settlement, we admit no wrongdoing. An agreement with iFinex, Tether, and their related entities will require them to cease any further trading activity with New Yorkers, as well as force the companies to pay $18.5 million in penalties, in addition to requiring a number of steps to increase transparency. "Tether's claims that its virtual currency was fully backed by U.S. dollars at all times was a lie," she added. Tether and Bitfinex — a popular digital currency exchange — are owned by the same company, Ifinex. The exchange announced early this month that it repaid an, “Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,”. “This resolution makes clear that those trading virtual currencies in New York state who … Bitfinex had initially taken the first step by repaying the $850 million loan obtained from Tether and provided over 2 million documentation pages to the NYAG office to settle the case. The New York Attorney General’s Office maintains that Tether stablecoin was not always fully backed by cash reserves on a 1:1 pegging against the US dollar. An 18 million USD fine has been agreed upon to be paid as a penalty regarding accounting failures. Cryptocurrency firms Tether and Bitfinex reached an agreement with the New York attorney general’s office to pay an $18.5 million fine to settle a legal dispute.. There are now about 34.8 billion tether tokens in circulation, according to data from CoinMarketCap, up from 2 billion three years ago. The much-discussed litigation that involved Bitfinex and Tether has now come to an end; the parties have reached a settlement. Executives at Bitfinex and Tether then allegedly engaged in a series of transactions that opened up Tether's cash reserves to Bitfinex. In […] "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. However, the crypto firms have admitted to no wrongdoing, but are now required to cease trading activity in New […] The settlement translated to both iFinex and Tether having agreed to pay $18.5 million in penalties. Your email address will not be published. The state’s top law enforcement official had been investigating the firms over allegations that they moved hundreds of millions of dollars to cover up the apparent loss of $850 million of commingled client and … “Today’s agreement requires Bitfinex and Tether to discontinue any trading activity with New Yorkers. New York Attorney General Letitia James made an announcement Tuesday about reaching a settlement agreement with iFinex, the parent company of Bitfinex, and Tether, which is putting an end to a 22-month legal battle. In addition, these companies must submit regular reports to the OAG to ensure compliance with this prohibition,” said the Attorney General’s Office. Tether is the company behind a well-known "stablecoin" of the same name. Your email address will not be published. Tether made a statement saying it admitted to no wrongdoing and will pay a sum of $18.5million to resolve the matter. Guillaume Payen | SOPA Images | LightRocket | Getty Images. Tether has always promised that every single Tether … The state's top law enforcement official had been investigating the firms over allegations that they moved hundreds of millions of dollars to cover up the apparent loss of $850 million of commingled client and corporate funds. As part of the settlement agreement, Tether has agreed to publish full … Data is a real-time snapshot *Data is delayed at least 15 minutes. The NYAG’s office announced the settlement Tuesday, formally ending the inquiry that kicked off in April 2019. Tether & @Bitfinex have reached a settlement with @NewYorkStateAG. Critics have also raised fears that tether tokens were used to manipulate bitcoin prices, a claim Tether has repeatedly denied. NYAG/Tether, Bitfinex settlement reveals commingling of funds, years of shenanigans. Quick Access to Ethereum & ETH related news, Quick Access to Ripple & XRP related news, Full breakdown and analysis of on-chain data, Calculate position size based on risk for margin trading. Crypto investors have been closely watching the New York fraud probe, which has gained more interest recently in light of bitcoin's meteoric surge. The settlement agreement alleges that Bitfinex and Tether made various misrepresentations to the market about Tether’s US dollar backing and the status of Tether reserves after Bitfinex lost several hundred million dollars in a series of opaque transactions, all the while conducting business in New York State without appropriate licensure. A smartphone displays the Tether market value on the via The Crypto App. Tether claims to have opened a $900 million line of credit to Bitfinex in 2018. Also, the settlement agreement acknowledged Bitfinex’s recent loan repayment to Tether. We want to hear from you. When news of the settlement broke, bitcoin’s price recovered from a drop down to $45,600, and now stands (as of writing) at around $50,000. The world's most valuable digital coin was already tumbling ahead of the New York attorney general's announcement. Tether is the market leader in the stablecoin market segment and has a market capitalization of $34.7 billion. All Rights Reserved. 1/3. Tether and Bitfinex have reached a settlement agreement with the New York Attorney General’s Office. The settlement amount we have agreed to pay to the Attorney General’s Office should be viewed as a measure of our desire to put this matter behind us and focus on our business. © 2021 CNBC LLC. The cryptocurrency has a market capitalization of $34.6 billion. Tether commented via a spokesperson: Under the terms of the settlement, we admit no wrongdoing. The settlement came after a long battle spanning over 2 years and sharing 2.5 million pages of information. Cryptocurrency firms Tether and Bitfinex reached an agreement with the New York attorney general's office to pay an $18.5 million fine to settle a closely-watched legal dispute. Tether and Bitfinex have reached a settlement agreement with the New York Attorney General’s Office. I wrote a quick article this morning about the New York attorney general settlement, wherein Bitfinex and Tether agreed to pay $18.5 million in penalties, stop servicing New York customers, and submit quarterly transparency reports. Just a few weeks ago, Bitfinex announced that they had repaid Tether the remaining loan balance of $550 million. This Settlement Agreement contains the findings of the OAG’s investigation and the relief agreed to by the OAG, Bitfinex, and Tether, whether acting through their respective directors, officers, employees, representatives, agents, affiliates, or subsidiaries (collectively, the Per the office, Tether must offer public disclosures, by category, of the assets backing tethers, including disclosure of any loans or receivables to or from affiliated entities. Bitfinex and Tether have agreed to pay $18.5 million as part of the settlement, according to a statement from New York Attorney General Leticia James. “Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” said the Attorney General. "As part of the settlement, Bitfinex and Tether have agreed to pay $18.5 million, according to a statement from New York Attorney General Letitia James." The settlement amount we have agreed to pay to the Attorney General’s Office should be viewed as a measure of our desire to put this … In its post, Tether pointed out that there was no finding after 2.5 years that the company “issued tethers without backing” or manipulated crypto prices. to put this matter behind us and focus on our business,” the stablecoin issuer said. Bitcoin was down 10% Tuesday, trading at a price of $48,713. It said that, from mid-2017, the company had no access to banking and misled clients about liquidity issues. The New York State Attorney General’s office recently concluded its long-running probe into Tether’s operations and fined the company $18.5 million as part of a settlement agreement. Join 12,590 others now and get actionable research and analysis sent directly to your inbox. ", Tether and Bitfinex refused to admit to any wrongdoing Tuesday but said "we share the Attorney General's goal of increasing transparency.". () Many seem to find the document exculpatory, but I find it damningAs I have discussed previously, Bitfinex and Tether are dishonest and we are now getting a better view into just how dishonest they are. Bitfinex and Tether have settled with the New York Attorney General. There have been concerns about whether Tether had enough cash reserves to back all the tether tokens in circulation. The settlement resolves allegations that iFinex – the parent company of crypto exchange Bitfinex and Tether – lied about the Tether (USDT) stablecoin and the hundreds of millions of dollars that exchanged hands to cover up Bitfinex’s massive losses. Tether and Bitfinex will be required to cease trading activity with New Yorkers and submit quarterly transparency reports, the attorney general's office said. Required fields are marked *. Disclaimer: I'm not very smart, so besides the parts I'm taking directly from the document, take this with a healthy amount of salt. Source: Twitter. Earlier this month, Bitfinex said it had repaid the remaining balance of a $550 million loan to Tether. Tether and Bitfinex are pleased to have reached a settlement of legal proceedings with the New York Attorney General’s Office. A spokesperson for the companies wasn't immediately available when contacted by CNBC for further comment. New York Attorney General Letitia James' office says it found that Tether sometimes held no reserves to back its cryptocurrency's dollar peg. NYAG claimed that as of the Q2 of 2019, Bitfinex collaborated with Tether and secretly used $850 million Terher’s fund to neutralize its loss processed by Crypto Capital payment. Crypto exchange, Bitfinex and stablecoin issuer, Tether have entered into a settlement with the New York Attorney General’s office (NYAG) after almost two years in a legal fight. The exchange announced early this month that it repaid an outstanding $550 million loan balance it owed Tether. Tether claims to have opened a $900 million line of credit to Bitfinex in 2018. Tether, which has denied any wrongdoing, said that an $18.5 million settlement fee will be paid to resolve the matter. The publication of the company’s reserve breakdown is part of the settlement. Market wide correction leads to liquidation of $3.8B in leveraged positions, National Bank of Egypt joins the RippleNet network, Nvidia wants to stop gaming chips from being used for crypto mining. "Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines," James said in a statement Tuesday. It's a major development in the crypto industry and concludes a long-running legal battle that started in April 2019. Tether’s agreement to pay the $18.5 million settlement fee is “a. The new document isn’t nothing, but it doesn’t … In addition, as part of the settlement, Tether committed to provide the public with a quarterly update on USDT’s reserves. Tether will pay $18.5 million in damages according to a settlement agreement with the Office of the New York Attorney General (NYAG). The agreement requires Tether and Bitfinex to cease any further trading activity with New Yorkers, as well as pay $18.5 million in penalties, in addition to requiring a number of steps to increase transparency, according to an announcement from the Office of the Attorney General (AGO). Tag: Settlement Agreement NYAG/Tether, Bitfinex settlement reveals commingling of funds, years of shenanigans I wrote a quick article this morning about the New York attorney general settlement, wherein Bitfinex and Tether agreed to pay $18.5 million in penalties, stop servicing New York customers, and submit quarterly transparency reports. This Settlement Agreement contains the findings of the OAG’s investigation and the relief agreed to by the OAG, Bitfinex, and Tether, whether acting through their respective directors, officers, employees, representatives, agents, affiliates, or subsidiaries (collectively, the “Parties”). In a 2019 filing, the attorney general's office said that Bitfinex handed $850 million to a Panama entity called Crypto Capital without disclosing it to investors. The New York Attorney General accuses Bitfinex and Tether of concealing $850 million in losses, misleading clients, and manipulating crypto prices. Apart from the $18.5 million settlement, the two companies have been barred from operating in New York. Sign up for free newsletters and get more CNBC delivered to your inbox. But there have been concerns about whether Tether had enough cash reserves to back all the tether tokens in circulation. After more than 2 years and over 2 million information pages, sister companies Bitfinex and Tether have finally settled with New York Attorney General’s Office. Tether proposed ongoing publication of the reserve breakdown as part of our settlement agreement with the New York Attorney General’s Office, and we committed to making that information available to both the Attorney General’s office and the public. The matter unfolded when Tether made a loan to Bitfinex after the latter failed to access approximately $850 million in funds held by a payment processor in 2018. Got a confidential news tip? Tether made a statement saying it admitted to no wrongdoing and will pay a sum of $18.5million to resolve the matter. Publication of Tether’s Reserves: On at least a quarterly basis for a period of two (2) years following the effective date of this Settlement Agreement, Tether will publish the categories of assets backing tether (e.g., cash, loans, securities, etc. Tether’s agreement to pay the $18.5 million settlement fee is “a measure of our desire to put this matter behind us and focus on our business,” the stablecoin issuer said. The two companies have been barred from conducting business in New York. "Contrary to online speculation, after two and half years there was no finding that Tether ever issued tethers without backing, or to manipulate crypto prices," the companies said in a statement on Tether's website. Settlement Agreement between the New York State Attorney General and seven cryptocurrency firms, namely iFinex Inc., the operator of a cryptocurrency exchange known as Bitfinex; BFXNA Inc., BFXWW Inc., Tether Holdings Limited, Tether Operations Limited, Tether International Limited, all of the British Virgin Islands, and Tether Limited, of Hong Kong. That token is meant to be backed one-to-one by U.S. dollars, the idea being that it's much more stable than most digital coins which have huge price swings. The crypto exchange Bitfinex reached a settlement with New York Attorney General Letitia James over allegations that it hid the loss of commingled client and corporate funds and lied about reserves. "In April 2019, the NYAG's office alleged that Bitfinex used Tether's funds to secretly cover $850 million lost to payment processor Crypto Capital. Tether and Bitfinex reached an agreement with the New York attorney general's office to settle a long-running legal dispute. I haven't seen a good summary of the settlement agreement anywhere, so hopefully this is somewhat useful. However, New York Attorney General Letitia James sees the matter in a different light. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. The settlement came after a long battle spanning over 2 years and sharing 2.5 million pages of information. Get this delivered to your inbox, and more info about our products and services. Tether and Bitfinex reached an agreement with the New York attorney general’s office to settle a long-running legal dispute. In the settlement agreement, the Attorney General accuses Tether of being dishonest with customers by describing tether stablecoins as fully backed by dollars. Bitfinex and Tether reach a settlement agreement with the New York Attorney General’s Office. Earlier this month, Bitfinex announced that it repaid Tether the remaining loan balance of $550 million and closed the credit line. In the settlement agreement, the NYAG’s office also acknowledged Bitfinex’s recent loan repayment to Tether. New York's top law enforcement official had been investigating the firms over allegations that they tried to cover up $850 million in losses. Under the terms of the settlement… Many crypto investors use tether to buy bitcoin and other virtual tokens. Trading in Tether has proven to be slightly bullish in the wake of an announced settlement which concluded the investigation into accounting failures by Tether and its sister company Bitfinex under the corporate umbrella of iFinex on Tuesday. The settlement with the NYAG represents a significant relief to Bitfinex and Tether, which had faced scrutiny in recent months. Save my name, email, and website in this browser for the next time I comment. Tether reach a settlement agreement with the New York Attorney General’s Office. A Division of NBCUniversal. Bitfinex, Tether settle with New York's Attorney General for $18.5 million From theblockcrypto.com | Feb 23, 2021 Crypto firms Bitfinex and Tether have settled with the New York Attorney General's (NYAG's) office, ending a legal dispute that began in mid-2019. After 2.5 years and 2.5M pages of info shared, we admit to no wrongdoing and will pay US$18.5M to resolve this matter. The lost funds allegedly triggered withdrawal problems for Bitfinex's customers … Tether and Bitfinex are pleased to have reached a settlement of legal proceedings with the New York Attorney General's Office.
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