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BREAKING: Tether Admits Investing In Bitcoin, But Claims NYAG Case To Be Dismissed

22 May 2019 12:32, UTC
BREAKING: Tether Admits Investing In Bitcoin, But Claims NYAG Case To Be Dismissed

Bitfinex and its associated stablecoin Tether, as a part of the ongoing investigation into its finances, has revealed in court that it used a part of its USD reserves to invest in Bitcoin (BTC), according to The Block report.

The transcription of the court proceedings contain the following: the attorney for Bitfinex David MILLER said that “Tether actually did invest in instruments beyond cash and cash equivalents, including bitcoin.”

New York Supreme Court Judge Joel M. COHEN addressed the issue, saying that there was no consistency in investing what meant to be a stablecoin in a volatile asset, which was the quite opposite to the very core essence of Tether.

Tether and Bitfinex have had a lawsuit from the New York Attorney General’s Office. The entities have

26.12.2018  |   in Cryptocurrencies
been accused of covering up $850 mln in losses through the use of illicit funds. Tether and Bitfinex vowed to fight the case, saying that the lawsuit was “filled with inaccuracies.” The NY Supreme Court ordered Tether to freeze transfers to Bitfinex.

At the time of writing the news, it became known that Bitfinex and Tether appealed for the dismissal of the case: companies claim that they do not have clients from New York, which means that it is impossible to proceed with the case in this jurisdiction. The statement reads:

"Bitfinex and Tether are foreign corporations that have no offices or other presence in New York, no customers here, and conduct no business in the state. There is accordingly no basis for 'general' personal jurisdiction over them under CPLR 301. Nor is there a basis for 'specific' personal jurisdiction under CPLR 302. The key factor under CPLR 302 is 'purposeful availment': if a company directs its conduct to a particular state, it can expect to be dragged to court there for matters relating to that conduct. What Tether and Bitfinex have done here is the opposite. They have steered clear of New York (and of the United States), and so cannot fairly be expected to defend legal proceedings here."
Bitnewstoday follows the course of events.

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