Tether and Bitfinex settle with the New York Attorney General for $18.5M over reserve claims

Tether/USDT

Tether and Bitfinex agreed to pay $18.5 million to the New York Attorney General to end a multi-year investigation alleging they hid an $850 million loss and misrepresented reserve backing. They admitted no wrongdoing but must provide quarterly reserve reports and stop serving New York customers.

• NYAG alleged that Bitfinex used Tether reserves to secretly cover $850M lost to payment processor Crypto Capital in late 2018.
• Settlement found that some USDT were not 1-to-1 backed by USD from June to September 2017, though no finding of deliberate over-issuance or price manipulation.
• Tether must file quarterly reserve reports for two years; both companies banned from New York but admitted no wrongdoing.