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The attorney general of New York, Letitia James recently made an announcement regarding the closing of two crypto trading platforms, Bitfinex and Tether after the two firms hid hundreds of millions in losses. Along with that, the trading platforms are ordered to shut all their businesses in the state and pay around $20 million in damages.
New York Attorney General Shutting Down Bitfinex and Tether
Letitia James revealed on Wednesday that two of the cryptocurrency trading platform, Bitfinex and Tether would be forced to shut down and pay a fine of up to $18.5 million after hiding about $850 million in losses around the globe.
James revealed in a press release that the set value of the service referred to as stablecoins, was deceptive and the agreements with both the trading firms would end all the trading activities with the people of New York. She said:
“Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines.”
In addition to this, the attorney general revealed:
“Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie.”
Criticizing the lack of regulation and license, Letitia James continued to say:
“These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system. This resolution makes clear that those trading virtual currencies in New York state who think they can avoid our laws cannot and will not.”
Further Actions Taken by the Crypto Trading Platforms
After the announcement of shutting down of the two cryptocurrency trading platforms, the accused companies agreed to stop any trading activity with people living in New York.
Moreover, the trading firms agreed to submit to necessary reporting on the core business functions of the company.