Bitfinex, a digital currency exchange platform by iFinex Inc. has incidents of users’ money being lost and stolen throughout its operation from 2012. Registered in the British Virgin Islands and a headquarter in Hong Kong, Bitfinex is known to have a shaky reputation.
Recently, a lawsuit that was filed in New York has come to public attention claiming the exchange platform, with its sister company, Tether has failed to prove that the stable coin is 1:1 backed by the US dollar.
The lawsuit reads that Tether and Bitfinex have systematically operated by deceptive and unfair practices and that they have a clear intention of manipulating the market and public. The damages that the two companies have incurred are said to surpass $1.4 trillion.
Besides Bitfinex, Tether has had an ongoing bad reputation of operating via misconduct as reported in many news outlets including Bloomberg in November last year. The digital currency that is said to be a stable coin is now proven to only have 74 per cent backing by the fiat currency, USD dollar and other assets.
Besides Bitfinex and Tether, other defendants named in the lawsuit are Digfinex and Crypto Capital. Furthermore, Phil Potter – Bitfinex’s former chief strategy office has left the company early last year.
As the matter will now go to court, the cryptocurrency community might soon get to know if these concerns are substantial and whether Bitfinex and Tether are guilty of misconduct.
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Nurul is an English Language graduate who is highly passionate on writing, she literally breathes on it. An avid reader and a critical thinker, she covers on blockchain news during day and weeps at sad novels at night.