Bitfinex Will Face NY Courts Over Missing $850M In Crypto Funds

The cryptocurrency exchange Bitfinex will face NY courts according to a recent order, and is about to face claims over the missing funds which total at least $850 million. The New York state court recently ruled that the exchange along with companies connected to it, must face court claims according to Bloomberg.

Last year, the New York State Attorney General Letitia James accused the exchange of hiding the loss of more than $850 million in client and corporate funds. The firms in question made claims that these funds were deposited in a company called Crypto Capital Corp which is based in Panama.

Then, the funds were seized by various governmental authorities and the exchange has been battling to recover them ever since. Bitfinex will face NY courts over them, right after the New York Attorney General accused the exchange of hiding more than $800 million in losses in 2019.

Founded in 2012, Bitfinex is a popular place which became the largest international cryptocurrency exchange after the Mt. Gox case imploded in 2014 and was all over the cryptocurrency news. Bitfinex is known for taking part of many controversies surrounding its stablecoin Tether (USDT) and whether it is actually backed by real dollars.

Meanwhile, the market capitalization of Tether surged this year and its treasury keeps minting more tokens to keep up with the growing demand. In 2020 alone, USDT has surged by 125% in terms of market capitalization – going from $4.1 billion to $9.2 billion according to data from CoinMarketCap. Currently, the Tether news show that USDT is the third largest cryptocurrency in terms of market cap and the provider of the majority of liquidity on exchanges around the world.

Meanwhile, Crypto Capital Corp. has been accused of money laundering many times, and known for its spurious activities that were centered around Tether, shuffling USDT around via a number of shell companies.

The fact that Bitfinex will face NY courts over these missing funds seems to have affected the market passively. Today, the news show that BTC is down by 2% while ETH, XRP, BCH and BSV are all with losses greater than 3% and find it hard to recover. The biggest loser is Cardano (ADA) again, after dropping to $0.11.