Tether Faces Legal Heat as Celsius $4 Billion Bitcoin Case Advances

The company stated that Tether sold over 39,500 Bitcoin BTC $117,802.67 in June 2022, according to court filings made in New York on June 30. It claimed that the sale happened before a 10-hour waiting period they had agreed on, and at a price lower than what the market was offering at the time.

Celsius noted that this caused them to lose access to Bitcoin, worth over $4 billion at the time of writing.

Did you know?

Want to get smarter & wealthier with crypto?

Subscribe - We publish new crypto explainer videos every week!

How do Cryptocurrency Exchanges Work? (Easily Explained!)

SUBSCRIBE

ON YOUTUBE

The funds from that sale were reportedly used to cover Celsius’s $812 million debt. After the sale, the assets were allegedly transferred to accounts controlled by Bitfinex $290.29M , a platform associated with Tether.

Celsius argued that these actions broke the terms of their lending deal. It also said Tether acted unfairly and in bad faith, which could be a legal issue under British Virgin Islands law, where both companies are based.

Additionally, Celsius claimed that the transfer of funds was improper under US bankruptcy law, which allows certain transactions to be reversed if they favor one creditor over another.

Tether tried to have the case thrown out by saying the deal happened outside the US and should not fall under American law. However, the judge said Celsius gave enough reason to believe that the key parts of the deal, including communications, staff, and money transfers, involved the US.

Meanwhile, on June 13, the crypto exchange Gemini sent a letter to Christopher Skinner, Inspector General of the Commodity Futures Trading Commission (CFTC). What did the letter say? Read the full story.