Tether-Bitfinex Bombshell Tanks Bitcoin and Other Top Cryptocurrencies

News
Fri, 04/26/2019 - 06:19
Alex Dovbnya
🌟The cryptocurrency market ends up in a bloodbath as the Tether-Bitfinex imbroglio continues with a brand-new twist
Tether-Bitfinex Bombshell Tanks Bitcoin and Other Top Cryptocurrencies
Cover image via twitter.com
Contents

The cryptocurrency market lost a whopping $10 bln in a snap after it was revealed that cryptocurrency exchange Bitfinex masked its missing funds with the help of its Tether reserves. Bitcoin and major altcoins are currently in the red.

Top coins suffer from minor losses
‘Almost all coins are in the red after the Tether-Bitfinex news, image by Coin360

Related Bitfinex Gets Its Bitcoin Back from US Government, Not All Users Will Be Compensated Though
Related
Bitfinex Gets Its Bitcoin Back from US Government, Not All Users Will Be Compensated Though

An $850 mln cover-up  

On Apr. 25, New York Attorney General Letitia James revealed that the exchange Bitfinex lost a startling $850 mln that were handled to payment processor Crypto Capital and covered the loss with its Tether reserves. James claims that she obtained a court order that requires iFinex, the Hong Kong-headquartered company that owns Bitfinex, to stop transferring USDT funds to the exchange’s bank accounts.

Related Tether’s USDT Launches on Tron (TRX) Network
Related
Tether’s USDT Launches on Tron (TRX) Network

Bitfinex’s response

Bitfinex swiftly issued a statement, calling the AG’s decision ‘a gross overreach.’ The embattled exchange is planning to fight the court order. The $850 mln that was allegedly replaced by Tether was never permanently lost, Bitfinex states. They are currently working to get back their ‘seized and safeguarded’ funds from Crypto Capital.

‘Bitfinex and Tether have been fully cooperative with the New York Attorney General’s office, as both companies are with all regulators. The New York Attorney General’s office should focus its efforts on trying to aid and support our recovery efforts,’ Bitfinex claims in its statement.

Related Tether’s USDT Launches on Tron (TRX) Network
Related
Tether’s USDT Launches on Tron (TRX) Network

Yet another controversy

The close ties between Bitfinex and the stablecoin operator have been a controversial subject in the cryptocurrency space for a long time. The explosive June report suggested that Tether was responsible for artificially pumping the price of Bitcoin. However, the findings were eventually put into question.

 

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.