September 28, 2021

Tether to report reserves and pay $18.5M fine after settlement with NYAG

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Bitfinex and Tether settled with the New York Attorney General office in the landmark case against Tether. New York authorities alleged that Tether misrepresented the degree to which Tether (USDT) coins were backed by fiat collateral.

The settlement requires Bitfinex and Tether to pay $18.5 million for damages to the New York State, as well as submit to periodic reporting of their reserves. The terms of the settlement mandate Bitfinex and Tether to report their current reserve status and budge, any transaction between the two companies, as well as provide public reports for the specific composition of their cash and non-cash reserves. The reports will need to be submitted each quarter for the next two years.

Finally, the settlement also requires Bitfinex and Tether to stop servicing customers in the state of New York.

As previously reported by Cointelegraph, the lawsuit by the NYAG alleged that Tethers were not fully backed by reserves at certain times. Specifically, Bitfinex is alleged to have opened a line of credit with Tether to repay an $850 million shortfall from the failure of its former partner, Crypto Capital Corp. The line of credit has since been closed,Title: Tether to report reserves and pay $18.5M fine after settlement with NYAG
Sourced From: cointelegraph.com/news/tether-to-report-reserves-and-pay-18-5m-fine-after-settlement-with-nyag
Published Date: Tue, 23 Feb 2021 13:18:11 +0000