Cryptocurrency exchange, Bitfinex has allegedly paid back another $550 million to Tether, now covering more than 100 percent of its $750 million loan facility they took out two years ago. The stablecoin printer started to repay the loan in July 2019 by transferring $100 million to Tether’s reserves.
Bitfinex stated that the last repayment was made entirely in fiat currency, which adds more backing to USDT tokens, which saw its fiat coverage drop to below 80 percent following the credit line given to its sister exchange.
“Bitfinex is happy to announce that in January it repaid the remaining balance of $550,000,000 of the outstanding revolving loan facility to Tether. Bitfinex made this payment in fiat currency wired to Tether’s bank account. The loan has now been repaid early and in full, and the line of credit has been cancelled,” the digital asset platform said.
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Bitfinex Targeted by Many Lawsuits
Bitfinex, who shares a parent company with Tether, is accused of using $750 million from the stablecoin reserves to cover up losses of $850 million. The crypto exchange defended itself, saying the money was deposited with a Panamanian-company called Crypto Capital but then was seized and safeguarded in several jurisdictions, including Poland, Portugal, the UK and the United States, all through no fault of Bitfinex.
Bitfinex has repeatedly questioned the New York Attorney General’s oversight authority and accused the office of using “a highly misleading factual presentation,” when it described its loan as nothing more than an IOU from Bitfinex “that seemed unlikely to be repaid.” However, the exchange has lost a legal battle to appeal the court decision that effectively killed its attempt to refrain from handing over documents to the New York Attorney General on the grounds of jurisdictional overreach.
Furthermore, Bitfinex and Tether faced another class-action lawsuit accusing them of fraudulently inflating the cryptocurrency market by printing uncovered USDT tokens in what the plaintiffs describe as “the biggest bubble in human history.” They claim that both partners colluded with others to artificially inflate Bitcoin prices, which shot higher just after the loss of Bitfinex funds was revealed.