- Bitfinex and Tether finally had a settlement with New York AG’s office for the legal proceedings which stayed for two and a half years
- The allegations of Tether issuing USDT without backing for manipulating crypto prices proved to be falsely acclaimed
Bitfinex and Tether are pleased to have reached a settlement of legal proceedings with the New York Attorney General’s Office. Under the terms of the settlement, they admit no wrongdoing. The settlement amount that Bitfinex has 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.
Over the past two and a half years, both the firms have worked in full cooperation with the Attorney General’s Office and provided more than 2.5 million pages of documentation to answer their questions and bring this matter to a close.
Justice to Bitfinex and Tether
The settlement resolves allegations about public disclosures related to a loan Tether made to Bitfinex when the exchange was encountering challenges accessing approximately US$850 million in Bitfinex funds held by a payment processor in 2018. These events are by now well known.
The loan was made to ensure continuity for Bitfinex’s customers. It has since been repaid early and in full, including interest. At no point did the loan impact Tether’s ability to process redemptions.
The Attorney General’s Office concluded, in essence, that the exchange could have done better in publicly disclosing these events. Contrary to online speculation, after two and a half years, there was no finding that Tether ever issued tethers without backing or to manipulate crypto prices.
Respectful Compliance By Bitfinex
Putting aside the Attorney General’s characterization of these disclosure issues as misrepresentations or violations of any legal obligation, Bitfinex shared the Attorney General’s goal of increasing transparency. For that reason, last year, Bitfinex voluntarily provided the Attorney General with information about the composition of Tether’s reserves and proposed that as part of the settlement agreement that they would disclose—both to the Attorney General’s office and to the public—additional information about Tether’s reserves. The exchange further added that commitment was not made reluctantly besides embraced it.
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