The rumors and allegations surrounding Bitfinex and Tether, and accusations by many in the crypto-community are unlikely to cease any time soon in light of New York State’s Attorney General’s court filings. New York State Attorney General’s court notice sheds an interesting light on the whole episode, showing the conversation between Bitfinex’s top executive and Crypto Capital.

Bitfinex teamed up with Crypto Capital in 2014 for the latter to act as a third-party payment processor for Bitfinex. The partnership was struck after Bitfinex faced problems with retaining banks for processing payments. According to the court notice, Crypto Capital had approximately $1 billion in co-mingled customer and corporate funds by 2018.

By mid-2018, Bitfinex was overwhelmed by customers’ requests to withdraw money from their platform since Crypto Capital held most of Bitfinex’s funds and refused to process the payments. At this point, Crypto Capital alleged that their funds had been seized by authorities in Poland, Portugal, and the US, which Bitfinex argued was not true.

In October 2018, rumors about Bitfinex’s insolvency started surfacing and were outrightly denied by Bitfinex in their blog dated October 07, 2018. Under the hood, however, Bitfinex’s top executive “Merlin” was “beseeching” an individual at Crypto Capital named “Oz”.

Source: Court Notice

The conversation was part of the court notice [attached above], and details Merlin’s request to move $100 million of Bitfinex’s funds so that they could honor their customers’ requests. The conversation between the aforementioned continued, with Merlin urging Oz to transfer the funds, failing which Bitcoin might tank below $1,000 [attached below], a prospect that was dangerous for the entire crypto community.

Source: Court Notice

These revelations by the New York State Attorney General caused the price of Bitcoin to drop from approximately $5,500 to $4,900 in under three hours. Bitfinex was quick to respond to the Attorney General’s allegations, stating that the New York AG’s court filings were written in ‘bad faith’ and ‘riddled with false assertions’.

Despite the fact that the case is yet to be resolved, its revelations, if proven true, could have astounding implications on the entire crypto-verse.

The post Bitfinex’s monetary issues could push Bitcoin below $1,000: Bitfinex executive ‘Merlin’ in 2018 appeared first on AMBCrypto.

237 +