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Is Bitfinex prolonging ongoing investigation?

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Bitfinex is enjoying a break from having to produce documents for the investigators. Regardless, it should be ready for when the respite ends.

Bitfinex and Tether: Traded illegally in New York?

Bitfinex and Tether have been alleged for trading illegally in the jurisdiction of New York. The New York Attorney General’s (NYAG) office is investigating the two companies.

NYAG has now filed a letter elucidating that Bitfinex and Tether, as well as other involved entities, are yet to produce documentation regarding the investigation. NYAG claims that the companies are trying to cover up an inter-company loan.

In April Bitfinex had lost access to around one billion dollars ($1B) in users and corporate funds.  NYAG alleges that the company made up for the missing funds by borrowing money from Tether’s reserves. Those funds were supposed to back the USDT tokens in circulation. This means that during the period the exchange had borrowed the sum around one billion Tether tokens were not backed up.

The New York Supreme Court Judge Joel Cohen has asked the respondents to submit a number of documents about the transactions as well as halt any lending by Tether.

Is Bitfinex stretching out the investigation?

The alleged immediately appealed and secured a temporary stay over document productions. Senior enforcement counsel John Castiglion claimed that the appeal would prolong the case for several more months during which no documents will be produced.

Therefore, John has asked the Judge to have respondents compile all necessary documentation now so that the investigation can proceed as soon as the appeal ends.

Ahmad Asghar

Ahmad Asghar

A first generation gamer at heart and tech buff by nature, have been involved in the tech sector for better part of a decade. With that insight and knowledge, he now covers blockchain, cryptocurrency and everything fintech so others can make sense of the industry.

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