HomeBitcoinA New York judge orders Tether to show evidence of USDT support.

A New York judge orders Tether to show evidence of USDT support.

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The plaintiffs’ requests to submit “undoubtedly crucial” papers in the alleged fraud case were granted by the court.

Judge Katherine Polk Failla of the Southern District of New York’s United States District Court ordered Tether to demonstrate the 1-to-1 backing of its eponymous stablecoin, Tether (USDT). The business must submit several records to the court, including “general ledgers, balance sheets, income statements, cash-flow statements, and profit and loss statements.”

The initial complaint by a group of investors against iFinex, Tether and Bitfinex’s parent company, claimed that the company manipulated the cryptocurrency market by issuing unbacked Tether with an intention to drive up the price of cryptocurrencies like Bitcoin. The order was published on Tuesday as part of the case that began back in 2019. (BTC).

The iFinex petitions to halt the order were denied by Judge Polk Failla on the grounds that the business had already provided “sufficient enough” documentation to the Commodity Futures Trading Commission and the New York Attorney General. Since they “appear to pertain to one of the Plaintiffs’ key complaints,” she determined that the Plaintiffs’ demand for “undoubtedly crucial” documents is well-founded.

Judge Polk Failla already dismissed the plaintiffs’ accusations against iFinex under the Racketeer Influenced and Corrupt Organizations Act as well as charges involving racketeering or the use of money from racketeering for investments in September 2021.

In a separate action concluded in February 2021 with the Office of the New York Attorney General, iFinex agreed to stop serving customers in the state and pay $18.5 million in penalties to New York. They also agreed to submit to regular reporting of their reserves. The agreement was reached following a 22-month investigation into whether the corporation had attempted to conceal losses that were reportedly worth $850 million by exaggerating the amount of fiat collateral backing its USDT reserves.

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