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Bitfinex Settles New York Probe Into Tether, Hiding Losses

  • No reserves were held at times to back Tethers as claimed
  • Companies banned from doing business with New Yorkers

Photographer: Rafael Henrique/Getty Images

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The crypto exchange Bitfinex reached a settlement with New York Attorney General Letitia James over allegations that it hid the loss of commingled client and corporate funds and lied about reserves.

Without admitting or denying any wrongdoing, the officials who control Bitfinex and the affiliated stablecoin Tether, agreed to pay $18.5 million, the state attorney general’s office said in a statement on Tuesday. New York officials, who originally began investigating Bitfinex in 2019, will receive quarterly reports on composition of Tether’s reserves for the next two years. The companies will end all trading activity with New Yorkers.