Bitcoin Dominance Growing — What It Could Mean for Altcoins

Are Bitfinex and Tether in trouble? Maybe, but the thing is, we don't know just how much trouble, because the stablecoin issuer has challenged the New York State Office of the Attorney General's (OAG) case against them. In claims filed in April, Attorney General Letitia James asserted that Bitfinex defrauded its customers, having lost $850 million in client and corporate funds, and then having attempted to cover up this loss by secretly helping itself to around $900 million of Tether's cash reserves.

Serious charges, but they're denied by Bitfinex and Tether’s parent company, iFinex, which responded in April that the OAG's claims were "riddled with false assertions" and that the lost $850 million is being safeguarded, although it didn't specify whether this amount is being held by Crypto Capital Corp. (which initially received it) or by some other entity. Regardless, iFinex has applied to have the case dismissed, arguing that the OAG has no legal basis to sue it for the simple reason that Bitfinex wasn't operating in New York during the period at issue.

However, while a New York judge has questioned the attorney general's "vague, open-ended" claims and asked for a more precisely constructed revision, recent news surrounding theclosing of a New York-based bank account indicates that Tether and Bitfinex may very well have been operating in the state of New York. This would suggest that the OAG's claims are legally valid and that Bitfinex and Tether may end up facing serious repercussions. But even if it does, certain crypto-related legal experts suggest that this wouldn’t necessarily be such a huge blow to crypto, which will endure with or without the liquidity provided by the Tether stablecoin, USDT.