Controversial cryptocurrency exchange Bitfinex has won a partial stay on New York’s demands for information. The company intends to vacate or modify the injunction it is facing.
Bitfinex can breathe for now
The New York Attorney General Letitia James recently alleged that the cryptocurrency exchange has been using its sister company Tether’s funds to hide its losses. The platform reportedly used $850 million from Tether’s reserves to mask its financial issues and problems related to withdrawals.
The company struck back at the AG, noting that the $850 million is actually being held by regulators and will be available when released. Tether also noted at the time at only 74% of its total outstanding tokens are backed by cash and cash reserves. The entire controversy dented the crypto market’s upward movement for a while but hasn’t had a lasting effect on the coins. In fact, Bitcoin has breached $8,000 in its most recent bull run.
Now, Bitfinex has won a partial stay on the demands of the New York AG to submit more information and intends to dismiss the lawsuit concerning its alleged use of Tether’s funds to hide losses worth hundreds of millions.
Bitfinex is moving ahead
In a Wednesday order, Judge Joel M. Cohen from the New York State Supreme Court put a hold on the AG’s demands to gain more information from the exchange. However, the stay is not applicable for topics relevant to the subject deciding whether the case can be heard in his court. He also asked the two sides to appear for arguments on July 29 this year to discuss if the stay should be applied to all requests for information from the AG. Meanwhile, Cohen will be considering the exchange’s request to scrap off the lawsuit.
In a blog post posted recently, the exchange said that the partial stay order is a victory in the ongoing defense of their business against the overreach of the New York AG. It wrote,
“We will continue to vigorously protect our customers and assert our rights against those making false and unsupported claims against us.”
The company is standing tall against the allegations made against it and is not backing down from a fight. Recently, it launched the first Initial Exchange Offering (IEO) in the world of a cryptocurrency called LEO coin. Bitfinex has intended to raise billions via this offering and help itself through the financial troubles it is facing.