Tether Reacts to Account Deactivation Accusations
Tether Holdings Inc has responded to claims that it deactivated the accounts of major crypto firms including MoonPay. The company responsible for issuing the stablecoin finally addressed the concerns raised about its operational choices. According to documents released by the New York Attorney General (NYAG), the issuer deactivated approximately 29 accounts belonging to prominent cryptocurrency entities in 2021. Tether, however, chose not to comment on individual relationships, but clarified that all individuals had successfully undergone compliance checks.
Notable Entities among Deactivated Accounts
Among the accounts that were deactivated, notable entities such as MoonPay, BlockFi, CMS Holdings (a crypto investment firm), and Galois Capital (a crypto hedge fund that is no longer operational) were included. The NYAG investigation, which concluded in February 2021, found that some documents in the investigation extended until June of the same year.
The NYAG Investigation and Settlement
These documents were gathered during the NYAG’s investigation into Tether and its sister company Bitfinex for the misappropriation of $850 million in funds. Both companies are under iFinex, who requested a 30-day extension to produce the financial documents. The parties ultimately reached a settlement agreeing to pay a penalty of $18.5 million and halt trading activities in New York.
Tether’s Resistance to FOIL Request
Despite requests from media outlets like Coinbase under the Freedom of Information Law (FOIL) for NYAG to publicly disclose their initial quarterly report, Tether objected to protect its customers’ confidential information. Despite Tether’s objection, the NYAG allowed media outlets access to the documents, revealing the deactivation of numerous cryptocurrency company accounts.
Conclusion: Tether’s Stance Amid Controversy
In the face of controversies, Tether maintains a firm stance on its operational decisions. The company remains committed to its stringent compliance checks and policies, as it continues to navigate the complex regulatory landscape of the cryptocurrency world. While the account deactivation issue has stirred up significant discussions, Tether’s response indicates a commitment to maintaining integrity, confidentiality, and regulatory compliance. As the scenario unfolds, it becomes clear that the adoption and integration of cryptocurrencies in the mainstream financial ecosystem will continue to be punctuated by regulatory scrutiny and the associated challenges. Yet, these instances serve as significant landmarks in the maturing cryptocurrency landscape, highlighting the increasing importance of transparency and compliance.
