Loading...

Tether breaks silence on account deactivation controversy

TL;DR

  • The New York Attorney General (NYAG) released documents indicating that Tether deactivated approximately 29 accounts belonging to prominent cryptocurrency players in 2021. 
  • However, the company clarified that all individuals had undergone thorough compliance checks during the onboarding process, as well as ongoing monitoring, as mandated by Tether’s compliance policies.
  • These recent developments have sparked interest and raised questions about Tether’s operations and compliance procedures. 

Tether has responded to concerns raised about its recent operational decisions. The New York Attorney General (NYAG) released documents indicating that Tether deactivated approximately 29 accounts belonging to prominent cryptocurrency players in 2021. While specific reasons for the account terminations were not disclosed, the Company has stated that it is not willing to comment on individual relationships.

However, the company clarified that all individuals had undergone thorough compliance checks during the onboarding process, as well as ongoing monitoring, as mandated by Tether’s compliance policies. It is important for Tether, as a stablecoin issuer, to ensure compliance with regulatory requirements to maintain stability and trust in its platform.

Among the deactivated accounts were notable names such as MoonPay, BlockFi, CMS Holdings, and Galois Capital. It is worth noting that the NYAG’s investigation into Tether and its sister company Bitfinex, which centered around allegations of misappropriating $850 million, concluded in February 2021. However, certain documents related to the investigation were extended until around June of the same year, with user codes redacted to protect privacy.

Tether operations and compliance procedures challenged

During the investigation, iFinex, the parent company of Tether and Bitfinex, requested a 30-day extension to produce critical financial documents. Eventually, a settlement was reached, with Tether agreeing to pay a penalty of $18.5 million and cease trading activities in New York. Subsequently, media outlets and Coinbase requested the NYAG to publicly disclose the Company’s initial quarterly report under the Freedom of Information Act.

However, the Company objected to this request, citing the need to safeguard its customers’ confidential information from potential exploitation by malicious individuals. Despite the Company’s objection, the NYAG allowed media outlets access to the documents, which revealed the deactivation of several company accounts.

These recent developments have sparked interest and raised questions about the Company’s operations and compliance procedures. As a prominent stablecoin in the cryptocurrency market, the platform plays a crucial role in facilitating transactions and maintaining price stability. It is important for the company to address concerns and provide transparency to maintain trust among its users and the broader cryptocurrency community.

Moving forward, the Company will likely face increased scrutiny from regulators and market participants, who will closely monitor its compliance practices and operational decisions. As the cryptocurrency industry continues to evolve, regulatory oversight and transparency will play a crucial role in ensuring the stability and integrity of stablecoins like Tether.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

Share link:

Lacton Muriuki

Lacton is an experienced journalist specializing in blockchain-based technologies, including NFTs and cryptocurrency. He dabbles in daily crypto news rich with well-researched stats. He adds aesthetic appeal, adding a human face to technology.

Most read

Loading Most Read articles...

Stay on top of crypto news, get daily updates in your inbox

Related News

Justin Sun
Cryptopolitan
Subscribe to CryptoPolitan