By Jonathan Stempel
NEW YORK () – The owner of the Tether cryptocurrency and the Bitfinex trading platform pays a $ 18.5 million fine to settle fees that the mixed client and corporate funds to cover the $ 850 million that disappeared, New York said Attorney-at-Law, Letitia James, Tuesday.
James said the civilian solution with iFinex Inc in Hong Kong and related entities will also require them to halt trading activities with New Yorkers.
Bitfinex was accused of sending $ 850 million to Crypto Cital Corp., a payment processor believed to be in Panama, without telling clients, and after the funds disappeared, drains at least $ 700 million from Tether’s reserves.
James said the reshuffle broke Tether’s public promise to investors that its currency had been backed one – by – one by US dollars, a practice she said had begun in 2017.
“These companies obscured the real risk that investors faced,” James said in a statement.
Tether is the world’s third largest cryptocurrency after Bitcoin and Ethereum according to CoinMarketC. Its market value was about 34.8 billion. Dollars on Tuesday, up from 2.8 billion. Dollars when James announced his charges during 2019.
Bitfinex and Tether did not admit or deny wrongdoing by agreeing to settle.
In a statement, they said the funds in question had been repaid in full with interest and never affected Tether’s ability to process redemptions.
“The Attorney General’s Office essentially concluded that we could have done better in publishing these events,” Bitfinex and Tether said. “Contrary to online speculation, after 2-1 / 2 years, there was no finding that Tether ever issued binders without backing or manipulating cryptocurrencies.”