Bitfinex Broke BitLicense Limitations, Maintains NYAG
The New York Attorney General has presented evidence of Bitfinex in the state of New York without BitLicense, despite the exchange’s denials.
The New York Attorney General will not give up on the Bitfinex case, recently presenting evidence that the exchange operator continued to serve New York state residents without owning a Bitlicense. The NYAG filed a Memorandum of Law in Opposition in the case against iFinex, blocking the iFinex motion to dismiss the case. Thus, NYAG gains another foothold against the exchange’s activity.
“...Even a cursory examination of the facts gathered to date in the OAG's investigation shows that Respondents have extensive and consistent contacts to New York concerning the matters under investigation,” the document states.
Bitfinex had clients in New York and held two bank accounts in New York banks. Another violation was noted in hiding the lack of solvency on Bitfinex after the funds of CryptoCapital were locked up for investigation.
“Respondents took hundreds of millions of dollars from Tether's cash reserves and allegedly used that money to satisfy the outstanding withdrawal requests and prop up Bitfinex, without disclosing any of that to Bitfinex traders or holders of tethers,” the NYAG maintained.
Currently, Bitfinex claims it is solvent and capable of paying back its traders, while also recently returning $100 million to Tether, Inc. There is still no audit or document to prove that the transfer has taken place.
So far, NYAG has not managed to directly attack the exchange based on the rumors of insolvency. Bitfinex managed to continue operations and no narrow accusation was filed. But with the case continuing, iFinex, the company behind Bitfinex, may face further scrutiny.
Informally, Bitfinex has faced rumors and accusations that it acted in cahoots with Tether, Inc. to print new USDT coins and manipulate the price of Bitcoin (BTC).
While the investigation continues, Bitfinex remains one of the most influential exchanges for BTC prices. As the news of renewed NYAG scrutiny and potentially a continuing investigation arrived, Bitfinex remained as active as ever. There were more than 3.76 billion USDT printed in total, with a recent addition of around 100 million USDT. Despite the new blows against Bitfinex, the price of BTC rose to a peak above $12,600 on Tuesday.