The two-year-long legal battle between the New York Attorney General Office and crypto firms Bitfinex and Tether finally came to an end with an $18.5 million settlement.
On Tuesday, the current New York Attorney General Letitia James issued a statement declaring that Bitfinex will pay $18.5 million as a penalty. Further, Tether and all its entities will have to halt any trading activities with the residents of New York.
The NYAG’s office began investigating Bitfinex in mid-2019 over accusations of hiding up to $850 million in losses. According to James’ statement, Bitfinex hid these losses and overstated its reserves, intending to parade a stable coin backed by the US dollar. After losing money to Crypto Capital, Bitfinex inturn collected funds from Tether in an attempt to hide the loss.
Crypto Firms Bitfinex and Tether Refuse to Own Up to NYAG’s Accusations
Although Bitfinex and Tether accepted the $18.5 million settlement, the two refused to own up to any accusations presented by the NYAG’s office. The companies’ counsel Jason Weinstein carried on that the charges were “limited only to the nature and timing of certain disclosures.” As for the $850 million alleged loss coverup, Bitfinex maintained it was a loan from Tether to which it concluded paying in January.
Adding to the monetary settlement, the crypto firms Bitfinex and Tether offered to provide information about Tether’s reserves to both the NYAG’s office and the public. The companies believe this would limit a repeat of another NYAG’s case in the future.
Ready to Move Forward
According to their general counsel Stuart Hoegner, Bitfinex and Tether agreed to the payment only to put the NYAG’s case behind them and move forward. Hoegner acknowledged the customers who, according to him, have remained loyal and committed throughout the legal battle.
USDT, Tether’s dollar-pegged stablecoin continued to grow in value since the NYAG’s case began 22 months ago. At the start of the inquiry, the value of USDT in circulation was $2 billion. Currently, the dollar-pegged tokens circle around $34 billion.