Home Crypto Currency Crypto exchange Bitfinex reportedly subpoenaed by top regulator

Crypto exchange Bitfinex reportedly subpoenaed by top regulator

168
0
SHARE



Trading screens.Carl
Court/Getty Images

  • The Commodity Futures Trading Commission has reportedly
    issued subpoenas to cryptocurrency exchange Bitfinex and
    Tether, the company behind a digital coin that claims to track
    the US dollar. 
  • Recently, Tether severed its relationship with its
    auditors. 
  • Both Bitfinex and Tether, which share a CEO, have come
    under fire for alleged foul play. 

The US Commodity Futures Trading Commission has reportedly issued
subpoenas to cryptocurrency exchange Bitfinex and Tether, the
company behind a digital coin that claims to track the US
dollar. 

The financial regulator sent out the subpoenas last week to the
two firms, which share a CEO, according to
a report by Bloomberg News’ Matthew Leising
, citing a person
familiar with the situation. 

The news follows an announcement by Tether that it severed its

relationship with its auditors
.

Tether’s cryptocurrency, called USDT, is pegged to — and
supposedly backed by — the dollar. It is meant to function as a
“stablecoin” — a cryptocurrency that allows you to avoid the
volatility of bitcoin but still have the operability of a
cryptocurrency.

“Given the excruciatingly detailed procedures Friedman was
undertaking for the relatively simple balance sheet of Tether, it
became clear that an audit would be unattainable in a reasonable
time frame,” Tether said in a statement.

The ending of the audit has fueled criticisms of the
cryptocurrency company. Specifically, there have been accusations
that the $2.3 billion worth of USDT currently in circulation are
not backed by actual dollars. 

The company’s last official audit was in March when only $44.7
million worth of USDT were in circulation. 


Screen Shot 2018 01 30 at 2.01.54 PMCoinMarketCap


The New York Times reported
 shortly after the
company experienced a hack in November:
“One persistent
online critic, going by the screen name Bitfinex’ed, has written
several very detailed essays on Medium arguing that Bitfinex
appears to be creating Tether coins out of thin air and then
using them to buy Bitcoin and push the price up.”

The CFTC declined to comment to Bloomberg. 

“We routinely receive legal process from law enforcement agents
and regulators conducting investigations,” Bitfinex and Tether
said in an email to Bloomberg. “It is our policy not to comment
on any such requests.”



Source link