Bitfinex will challenge $ 850M heavily lost & # 39; False Assertions & # 39;

After the New York Attorney General has accused a $ 850m cover-up of Bitfinex, the company has issued its reply. Binfinex disproves the claims as "riddled with false claims" and that the funds are not lost.

The Cover-Up Claims

According to the NY Attorney General's claim, Bitfinex lost $ 850 million of customer money. This had been sent to, and seized by, the payment company Crypto Capital Corp. The claim continues to say that Bitfinex used cash reserves from associated stablecoin, Tether, to cover the deficit.

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The AG, Letitia James, claims this "loss of funds" and movement of reserves was not disclosed by both Bitfinex and Tether, iFinex operators. Therefore, it had "engaged in a cover-up to hide the apparent loss of $ 850 million of collaborative customer and corporate funds."

At press time, the price of USD Tether 0 0 [19659009] has fallen bellow its $ 1 point. At the same time, their competitors act as stablecoin as USD-Coin 0 0 and TrueUSD 0 0 now with a small premium.

This suggests that investors are

Bitcoinist reported yesterday that the supply of tethers has reached an all-time high.

Bitfinex and Tether are financially strong & # 39;

19659003] Bitfinex responded today by claiming that AG's submission:

… was written in bad faith and rejected by false claims, including a claim of $ 850 million "losses" at Crypto Capital.

It claimed that these funds were not lost but had "actually been seized and secured" and it worked actively to get these funds released. It continued to chastise AG for not doing more to help and support its recovery.

Both Bitfinex and Tether are financially strong – full stop. And both Bitfinex and Tether are committed to fighting this brutal assault by the New York Attorney General's office against companies that are good corporate citizens and strong law enforcement supporters. Bitfinex and Tether will challenge this, and all other actions, by the New York Attorney General's office.

The Double Standards

Caitlin Long pointed out on Twitter that although the claims were true, NY AG was guilty of double standards. From 2009-12, Merrill Lynch, according to SEK:

upcoming customer funds, used them to cover their own commitments, and had failed the customers would have suffered a "massive shortfall of the reserve account." [19659021] Which is really what AG accuses iFinex of. But while the SEC dealt with the Merrill Lynch case without causing panic and customer recall, the flow of AG has just kicked that for iFinex.

She also urged the exchanges to clean up their actions on transparency and proof of solvency to avoid such situations.


Lawyer's filing claims that the Tether funds were extended as a credit over three years with a 6.5% interest rate. An iFinex share fee of 60,000,000 shares secured the loan.

Entrepreneur and commentator Alistair Milne commented on the situation quite briefly and concluded that as long as "Bitfinex is acting profitable, no problem."

That brings us back to openness and disclosure.

If iFinex told customers and investors about this alleged "attack" and "loan", would they now have a problem? And is AG & # 39; s & # 39; gotcha approach really guaranteed here?

In any case, it is important to note that there are no criminal charges at this time.

Is NY Generaly Attorney acting in "bad faith"? Share your thoughts below!

Pictures via Shutterstock

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