Summary:
- Lawsuit Filed: Celsius Network Limited has filed a lawsuit against Tether, alleging misappropriation of assets and seeking $3.5 billion in Bitcoin returns, damages, and legal fees.
- Dispute Over Liquidation: The lawsuit centers around a June 2022 liquidation of BTC collateral, which Celsius claims was unjust. Tether, however, asserts the liquidation was carried out under Celsius’ direction.
- Tether’s Response: Tether has strongly dismissed the lawsuit, calling it “baseless” and a “meritless shakedown,” and vows to vigorously defend against the allegations.
Defunct cryptocurrency exchange Celsius Network Limited has filed a lawsuit against Tether, the issuer of the largest stablecoin USDT, seeking approximately $3.5 billion in Bitcoin (BTC) returns, damages, and legal fees. The lawsuit, filed on Aug. 9 in the United States Bankruptcy Court for the Southern District of New York, revolves around a dispute over a 2022 agreement between the two companies.
Celsius alleges that Tether wrongfully liquidated approximately $2.4 billion worth of BTC collateral in June 2022, when Bitcoin’s price began to plummet. The company claims that the liquidation was unjust and is now seeking the return of 57,428.64 BTC or its current market dollar equivalent, in addition to damages and legal fees.
In response, Tether has strongly denied the allegations, labeling the lawsuit as “baseless” and an example of a “meritless shakedown.” Tether maintains that the liquidation was carried out at Celsius’ direction and with its consent, following Celsius’ decision not to provide additional collateral to avoid a margin call. The stablecoin issuer asserts that it was Celsius, not Tether, that initiated the selloff to close out its approximately $815 million USDT position.
The lawsuit underscores the ongoing tensions and legal battles within the cryptocurrency industry, particularly in the wake of Celsius’ bankruptcy filing in July 2022. As the case moves forward, it remains to be seen how the court will rule on the dispute between these two major players in the crypto space.
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