There are now about 34.8 billion tether tokens in circulation, according to data from CoinMarketCap, up from 2 billion three years ago. We want to hear from you. From the beginning of its interaction with the OAG, iFinex and Tether falsely claimed that they did not allow trading activity by New Yorkers. our partners use cookies to personalize your experience, to show you ads based on your interests, and for measurement and analytics purposes. Get a beginners guide from _BeInCrypto Academy_ now! However, an investigation by the Office of the Attorney General (OAG) found that iFinex — the operator of Bitfinex — and Tether made false statements about the backing of the “tether” stablecoin, and about the movement of hundreds of millions of dollars between the two companies to cover up the truth about massive losses by Bitfinex. Got a confidential news tip? "These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system. The OAG had established the factual predicate necessary to uphold the injunction and require production of documents and information relevant to its investigation in advance of the filing of a formal suit. Every tether is also 1-to-1 pegged to the dollar, so 1 USDT is always valued by Tether at 1 USD.” 11. The companies agreed to pay $85 million and cease trading operations with New York customers. Note for New York: SBRs and SBSs are not specifically, by that or a similar name, banned in NY, but are covered under the handgun portion of assault-weapon definition as banned firearms. In September 2018, the OAG issued its Virtual Markets Integrity Initiative Report, which highlighted the “substantial potential for conflicts between the interests” of virtual currency trading platforms, insiders, and issuers. In the case of Tether, the company represented that each of its stablecoins were backed one-to-one by U.S. dollars in reserve. However, the very next day, on November 2, 2018, Tether began to transfer funds out of its account, ultimately moving hundreds of millions of dollars from Tether’s bank accounts to Bitfinex’s accounts. In the face of persistent questions about whether the company actually held sufficient funds, Tether published a self-proclaimed ‘verification’ of its cash reserves, in 2017, that it characterized as “a good faith effort on our behalf to provide an interim analysis of our cash position.” In reality, however, the cash ostensibly backing tethers had only been placed in Tether’s account as of the very morning of the company’s ‘verification.’. In addition, these companies must submit regular reports to the OAG to ensure compliance with this prohibition. In addition, these companies must submit regular reports to the OAG to ensure compliance with this prohibition. Cryptocurrency Firms Bitfinex, Tether Settle New York Attorney General’s Probe Attorney general says the companies ‘unlawfully covered up’ financial losses That token is meant to be backed one-to-one by U.S. dollars, the idea being that it's much more stable than most digital coins which have huge price swings. That action — under Section 354 of New York’s Martin Act — ultimately led to a July 2020 decision by the New York State Appellate Division of the Supreme Court, First Department, holding that: Bitfinex and Tether Banned from Continuing Illegal Activities in New York. Tether is the company behind a well-known "stablecoin" of the same name. Tether represents to users that any holder of tethers can redeem them from Tether the company at the rate of one tether for one U.S. dollar. The companies will also provide greater transparency and mandatory reporting regarding the use of non-bank “payment processors” or other entities used to transmit client funds. There have been concerns about whether Tether had enough cash reserves to back all the tether tokens in circulation. The Attorney General’s office found that Bitfinex allegedly handed over $850 million in co-mingled client and corporate funds to Crypto Capital Corp, a company based in Panama. NY Attorney General goes after Tether and Bitfinex for $850M cover-up And an unpaid $700m loan fronted by investors. A copy of this disclaimer can also be found on our Disclaimer page. These legal actions send a clear message that we will stand up to corporate greed whether it comes out of a traditional bank, a virtual currency trading platform, or any other type of financial institution.”, A Stablecoin Without Stability – Tethers Weren’t Fully Backed At All Times, The OAG’s investigation found that, starting no later than mid-2017, Tether had no access to banking, anywhere in the world, and so for periods of time held no reserves to back tethers in circulation at the rate of one dollar for every tether, contrary to its representations. On November 1, 2018, Tether publicized another self-proclaimed ‘verification’ of its cash reserve; this time at Deltec Bank & Trust Ltd. of the Bahamas. Many crypto investors use tether to buy bitcoin and other virtual tokens. However, the "Google Translate" option may assist you in reading it in other languages. In April 2019, the OAG sought and obtained an injunction against further transfers of assets between and among Bitfinex and Tether, which are owned and controlled by the same small group of individuals. Stablecoins, specifically, are virtual currencies that are always supposed to have the same real-dollar value. Guillaume Payen | SOPA Images | LightRocket | Getty Images. The State of New York, its officers, employees, and/or agents shall not be liable for damages or losses of any kind arising out of, or in connection with, the use or performance of such information, including but not limited to, damages or losses caused by reliance upon the accuracy of any such information, or damages incurred from the viewing, distributing, or copying of such materials. On October 7, 2018, Bitfinex claimed to “not entirely understand the arguments that purport to show us insolvent,” when, for months, its executives had been pleading with Crypto Capital to return almost a billion dollars in assets. An agreement with iFinex, Tether, and their related entities will require them to cease any further trading activity with New Yorkers, as well as force the companies to pay $18.5 million in penalties, in addition to requiring a number of steps to increase transparency. The New York State Attorney General (NYSAG) is suing Bitfinex, the cryptocurrency exchange, and affiliated firm Tether, the company behind the stablecoin of … The cryptocurrency has a market capitalization of $34.6 billion. Today’s agreement requires Bitfinex and Tether to discontinue any trading activity with New Yorkers. All Rights Reserved. The Office of Attorney General's website is provided in English. New York Attorney General Letitia James’ office says it found that Tether sometimes held no reserves to back its cryptocurrency’s dollar peg. Today’s agreement requires Bitfinex and Tether to discontinue any trading activity with New Yorkers. In 2017 and 2018, Bitfinex began to increasingly rely on third-party “payment processors” to handle customer deposits and withdrawals from the Bitfinex trading platform. NEW YORK – New York Attorney General Letitia James today continued her efforts to protect investors from fraudulent and deceptive virtual or “crypto” currency trading platforms by requiring Bitfinex and Tether to end all trading activity with New Yorkers. The authorities claimed that the cryptocurrency exchange operator, iFinex Inc, was also involved in creative accounting. Bitfinex was one of the trading platforms examined in the report. A Division of NBCUniversal. Both the Bureau of Internet and Technology and the Investor Protection Bureau are part of the Division for Economic Justice, which is overseen by Chief Deputy Attorney General Chris D’Angelo and First Deputy Attorney General Jennifer Levy. When No Bank Backs You, Turn to Shady Entities — Bitfinex Hid Massive Losses. Last week, we sued to shut down Coinseed for its fraudulent conduct. In 2018, while attempting to “move money [more] efficiently,” Bitfinex suffered a massive and undisclosed loss of funds because of its relationship with a purportedly Panama-based entity known as “Crypto Capital Corp.” Bitfinex responded to pervasive public reports of liquidity problems by misleading the market and its own clients. Tethering or chaining a dog under most state laws means that a person ties a dog with a rope or line to a stationary object. Anyone relying on information obtained from Google Translate does so at his or her own risk. Cryptocurrency firms Tether and Bitfinex reached an agreement with the New York attorney general's office to pay an $18.5 million fine to settle a closely-watched legal dispute. These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system. … NYAG’s Probe of Bitfinex, Tether Ends in an $18.5M Settlement - CoinDesk Bitfinex and Tether will admit no wrongdoing in their $18.5 million settlement with the New York … USDT continues to come under scrutiny from regulators. New York's top law enforcement official had been investigating the firms over allegations that they tried to cover up $850 million in losses. "Tether's claims that its virtual currency was fully backed by U.S. dollars at all times was a lie," she added. In a statement on Tuesday, NY Attorney General Letitia James accused the two entities of hiding severe losses from investors. Tether has banned 40 Ethereum addresses holding millions of dollars of the stablecoin USDT, according to an analysis by Ethereum researcher Philippe Castonguay who shared his findings on Dune Analytics. Tether and Bitfinex will be required to cease trading activity with New Yorkers and submit quarterly transparency reports, the attorney general's office said. New York State Prohibited and Regulated Invasive Plants September 10, 2014 NYS DEPARTMENT OF NYS DEPARTMENT OF ENVIRONMENTAL CONSERVATION AGRICULTURE AND MARKETS Summary: As of 2021, about twenty-three (23) states have laws that limit or otherwise control how owners can tether their dogs. Additionally, Tether must offer public disclosures, by category, of the assets backing tethers, including disclosure of any loans or receivables to or from affiliated entities. Critics have also raised fears that tether tokens were used to manipulate bitcoin prices, a claim Tether has repeatedly denied. Stuart Hoegner, general counsel for both Bitfinex and Tether, … The owner of the Tether cryptocurrency and Bitfinex trading platform will pay an $18.5 million fine to settle charges it commingled client and corporate funds … The OAG Investigation Shines a Light on Unlawful Trading in New York State. Story by Matthew Beedham. Sign up for free newsletters and get more CNBC delivered to your inbox. A smartphone displays the Tether market value on the via The Crypto App. Bitfinex and Tether are banned from "continuing illegal activities" in NY. Bitfinex and Tether Banned from Continuing Illegal Activities in New York. Earlier this month, Bitfinex said it had repaid the remaining balance of a $550 million loan to Tether. Tether is fined by regulators in New York. It's a major development in the crypto industry and concludes a long-running legal battle that started in April 2019. Tether is one of the most prominent and widely-traded virtual currencies. Magazines like these (which hold 30 rounds) are banned in New York. AG bans Bitfinex, Tether from operating in NY EPA-EFE/JUSTIN LANE The ban is a result of a probe that found that at times Tether didn't have enough funds or ways to secure them, meaning it was unable to back tethers in circulation at the rate of one dollar for every coin. Tether and Bitfinex — a popular digital currency exchange — are owned by the same company, Ifinex. New York Attorney General Shuts Down Bitfinex And Tether Trading in State; Groups Agree $18.5 Million Fine. In a 2019 filing, the attorney general's office said that Bitfinex handed $850 million to a Panama entity called Crypto Capital without disclosing it to investors. Tether and Bitfinex have reached an $18.5 million settlement with the New York (NY) Attorney General. Further, the companies must submit to mandatory reporting on core business functions. New York Attorney General Letitia James' office says it found that Tether sometimes held no reserves to back its cryptocurrency's dollar peg. This resolution makes clear that those trading virtual currencies in New York state who think they can avoid our laws cannot and will not. Bitfinex and Tether Banned from Continuing Illegal Activities in New York. The OAG investigation determined that to be untrue and that the companies have operated for years as unlicensed and unregulated entities, illegally trading virtual currencies in the state of New York. 36 Series: deBanked News Episodes First Aired: Feb 24, 2021 - Featuring: Sean Murray, Johny Fernandez © NEW YORK STATE ATTORNEY GENERAL. “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie. Bitfinex and Tether — and other virtual currency trading platforms and cryptocurrencies operating from various locations around the world — are still subject to OAG jurisdiction if doing business in New York; The stablecoin “tether” and other virtual currencies were “commodities” under section 352 of the Martin Act, and noted that virtual currencies may also constitute securities under the act; and. Finance & economics Feb 27th 2021 edition. Bitfinex and Tether Must Submit to Mandatory Reporting on Efforts to Stop New York Trading, Bitfinex and Tether Deceived Clients and Market by Overstating Reserves,Hiding Approximately $850 Million in Losses Around the Globe. Get this delivered to your inbox, and more info about our products and services. All rights reserved. ", Tether and Bitfinex refused to admit to any wrongdoing Tuesday but said "we share the Attorney General's goal of increasing transparency.". "Contrary to online speculation, after two and half years there was no finding that Tether ever issued tethers without backing, or to manipulate crypto prices," the companies said in a statement on Tether's website. Millions around the country and the world today use virtual currencies as decentralized digital currencies — unlike real, regulated government currencies, including the U.S. dollar — to buy goods and services, often times anonymously, through secure online transactions. The Investor Protection Bureau is led by Chief Peter Pope. Back in April 2019, Bitfinex was accused of using Tether to cover $850 million of lost funds. In April 2019, the New York attorney accused Bitfinex of covering up the loss of $850 million of users’ funds with stablecoins issued by Tether. This Google™ translation feature is provided for informational purposes only. Google Translate cannot translate all types of documents, and it may not give you an exact translation all the time. The state became one of the first to make major changes in police practices in the wake of George Floyd’s killing, which has spurred nationwide protests. The announcement linked to a letter dated November 1, 2018, which stated that tethers were fully backed by cash, at one dollar for every one tether. Specifically, both Bitfinex and Tether will need to report, on a quarterly basis, that they are properly segregating corporate and client accounts, including segregation of government-issued and virtual currency trading accounts by company executives, as well as submit to mandatory reporting regarding transfers of assets between and among Bitfinex and Tether entities. "Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines," James said in a statement Tuesday. Promises, assurances, or guarantees as to the State of New York Attorney General 's office to a. 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