New York Attorney General Turns Up The Heat On Tether, Bitfinex

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bitcoin bluesBitcoin is back over $12,500 but a growing chorus within the crypto faithful are pointing to a potential catastrophic event that could change the crypto markets forever.

It’s the potential implosion of Tether, a company spotlighted in a recent deBanked magazine story for its uncanny ability to create digital dollars out of thin air, and a new forceful response from the New York Attorney General’s Office over Tether’s attempt to weasel its way out of being investigated.

Specifically, Tether has raised several challenges to the OAG’s and New York Supreme Court’s jurisdiction, most recently through a motion to dismiss a formal investigation. The OAG, who believes the tactics are only being used to stall, wrote in papers submitted on Monday that “the delays must stop, and Respondents must produce the information they were originally directed to produce.”

The AG calls out Tether on its claims that its digital dollars (USDT) are fully backed 1:1 by real US dollars on deposit in a bank account, when in fact they are not. Additionally, they believe Tether is attempting to circumvent a court ordered injunction and is further bending securities laws in part by purportedly selling $1 billion of a new digital token to anonymous investors to cover losses that are already under investigation.

“This is an ongoing law enforcement investigation. The OAG is entitled to pursue it, without further impediment or delay,” they state in court papers, stressing yet again that Tether should no longer be allowed to delay the process.

Tether meanwhile, reportedly created another $100 million of USDT the same day the papers were filed. Should those funds be used to buy Bitcoin, Bitcoin’s value might continue to surge… in the short run.

Last modified: July 9, 2019

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