Bitfinex Asks Supreme Court to Throw out NYAG Charges

Bitfinex says it doesn’t allow New Yorkers on their platforms and never advertised or otherwise did business there,

Crypto exchange Bitfinex and its affiliated stablecoin issuer Tether asked a US judge to dismiss the New York attorney general’s case against them, saying they did nothing wrong as they have never targeted investors in the state.

The US authorities have stepped up their enforcement against the crypto firms with the NY attorney investigating them for fraud because of duplicitous statements about the digital tokens’ backing. Specifically, Bitfinex is accused of using $700 million from Tether reserves to cover up losses of $850 million

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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.

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The wild story took another turn on May 16 after the New York supreme court granted the motion to modify the substance and temporal scope of the original injunction filed by NY Attorney against Bitfinex’s business.

Bitfinex wants supreme court to deny the NYAG’s request

The court’s order described the NYGA’ injunction as “vague, overbroad, and not time-limited,” and allowed Bitfinex and Tether to continue their normal business activities. However, Bitfinex wants the supreme court to help it further and deny the NYAG’s request to turn over documentation about the loan and line of credit that Tether provided to the controversial cryptocurrency exchange.

The document further reads: “The OAG chose to target two virtual currency businesses that have nothing to do with New York investors — the businesses do not allow New Yorkers on their platforms and do not advertise or otherwise do business here.” The lawyers added that the New York State Attorney General’s office has not identified, even in a general sense, any victim in New York or anywhere else.

“Making matters worse, OAG has proceeded under a statute, the Martin Act, governing “securities” and “commodities,” neither of which describes the product bought by the supposed “victims” here, a “stablecoin” called tether,” the filing adds.

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