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Tether and Bitfinex investigation is (again) behind schedule

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For several months, the Tether and the Bitfinex platform have been the target of an investigation in the United States. This matter is taken very seriously by the cryptopsher given the notoriety of the Tether. However, recently the current investigation has suffered some delays and some results should therefore arrive later than expected. Back to the latest elements of the investigation.

Tether, a crypto juggernaut

The Tether is admittedly less well known than Bitcoin and Ethereum. Yet behind these two cryptos, Tether completes the podium of the cryptocurrency colossi in terms of capitalization. Thus, at the time of writing this note, the Tether is capitalized up to 20 billion euros.

The particularity of Tether is that it is a stablecoin and not a cryptocurrency. For more details, you can check out our guide to stablecoins. To put it simply, a stablecoin is a (electronic) money of which the course does not vary. If you look at the historical chart of the price of Tether, you will see that its price is stable. It fluctuates very little around its target value of one dollar (ie 0.82 €). DAI is another stablecoin that works on the same principle.

Investing in stablecoin is complementary to buying cryptocurrency. Indeed, since the price of a stablecoin does not fluctuate, it is an excellent solution to protect your holdings against volatility. For example, between two investments, you can secure your earnings by purchasing Tether.

Tether in the eye of the storm

Tether is therefore a dollar backed stablecoin. The stability mechanism of Tether (and stabcoins in general) ensures that for each Tether purchased, the platform sets aside a dollar in its own fund. However, it is precisely this mechanism that is closely watched by American justice today.

iFinex is the parent company of Tether and its Bitfinex trading platform. Following several failures to form partnerships with banks, Bitfinex turned to Panama. In 2018, a bank in Panama held virtually all of Bitfinex’s equity. The problem is that as a result of this financial package, Bitfinex has not been able to meet requests for cash withdrawals from its customers.

“Our investigation determined that the Bitfinex platform operators who also control Tether covered up the loss of approximately $ 850 million belonging to theirs customers and businesses. “

Letitia James, New York Attorney General in charge of the Tether investigation

The current investigation therefore aims to shed light on this failure and possible concealment to which Bitfinex has lent itself. At the moment, Bitfinex already has transmitted over 2.5 million pages to justice to ensure his defense, according to his general counsel, Stuart Hoegner.

However, the judicial calendar still called for the production of further documents by Bitfinex by January 15. However, by mutual agreement with the courts, it has just been decided to shift 30 days the issuance of these documents, like yearno itby the Financial Times. This is already the second time lag recorded since the start of the investigation. It must be said that these documents are very important! Indeed, they should allow justice to determine whether Bitfinex should be continued or not.

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