Allegations claim firms made misleading claims about Tether’s cryptocurrency stablecoin: CFTC
Cryptocurrency Tether and crypto exchange Bitfinex will pay $42.5 million to the US Commodity Futures Trading Commission (CFTC) to settle civil fees for allegedly making misleading statements and conducting illegal transactions.
Firms trading as Tether have agreed to pay $41 million to settle CFTC fees they made misleading claims about Tether’s cryptocurrency stablecoin, the CFTC said in a statement on Friday. According to the regulator, several times, from June 2016 to the end of February 2019, Tether made misleading or untrue statements about whether it had enough USD reserves to fully back its USD-denominated Tether token.
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In a separate order, firms doing business as Bitfinex agreed to fine $1.5 million on charges that it was not sufficient to deter US customers from illegally engaging in retail commodity transactions on the exchange. . The CFTC said it violated US law and entered into a 2016 settlement with Bitfinex on similar allegations.
Neither Tether or Bitfinex, controlled by the same parent company, accepted nor denied the findings.
In a statement on its website, Tether challenged the CFTC’s statements, saying that the agency’s conclusion was that Tether’s dollar reserves in Tether’s name bank accounts were not in cash at all times, but that the tokens were entirely in cash. were not supported.
CFTC Commissioner Don Stump, a Republican, confirmed the agency’s findings that “the assurances provided to Tether customers were not true 100% of the time, 100% of the time” and that, according to a statement published with the CFTC orders, “a wrongdoing occurred, “.
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However, Stump raised concerns that the resolution – the first time the CFTC has applied the definition of a “commodity” to a stablecoin – would lead to confusion among cryptocurrency firms and investors.