Bitfinex is blocked from Tether reserves during the lawsuit

by in Cryptocurrency News

Bitfinex is blocked from Tether reserves during the lawsuit

Crypto exchange Bitfinex stays obstructed from using supplies from the cash savings of Tether as an authority judges whether to dismiss a regulator’s lawsuit claiming the corporations hid losses of more than $850 million.

Letitia James, New York Attorney General, sued the corporations in April 2019, telling officials cooked up a series of “opposed corporate transactions” in which Bitfinex presented itself access to as much as $900 million of Tether’s cash resources, which Tether frequently told investors completely backed its coin.

New York State Supreme Court Justice Joel Cohen reached a directive he issued in April on July 29, which was to prevent Bitfinex from obtaining, loaning or making any request on Tether’s cash supplies pending James’ investigation while he considers a bid to dismiss the case.

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Hong Kong-based Ifinex Inc., the company that regulates Bitfinex and Tether, has asked Cohen to throw out the suit, saying that New York has no control in this matter, as U.S. residents aren’t permitted to trade on the exchange, which is listed in the British Virgin Islands. The litigation has impacted the associated companies’ ability to freely used their funds.