Topic: NY Attorney General sues Bitfinex - page 2. (Read 329 times)

Yes, Bitfinex isn't saying enough, or isn't saying the truth. It says 850 millions have been seized, and that is certainly possible, but in that case, it means there are legal proceedings which could prove the seizure. Only thieves seize money without traces.

neither the NYAG nor bitfinex could actually confirm the $850m in crypto capital funds held on behalf of bitfinex was seized: https://bitcoinmagazine.com/articles/bitfinex-faces-legal-action-from-ny-attorney-general-heres-what-this-means/

so we're not really sure if it was stolen or seized. in the end, it doesn't really matter and bitfinex is clearly spinning things. the important fact is that bitfinex lost access to $850m, couldn't process its customer fiat withdrawals, and dipped into tether funds to cover the shortfall. depending on other assets held by bitfinex/tether, they may not be insolvent. but this certainly suggests they are.

I found two articles to be about what I presume you are referring to.

Bitfinex had to borrow $700M from tether, out of the $850M that is unaccounted for. It would not be unreasonable to say Bitfinex had $150M in reserves.

If the $370M is in fact part of the $850M, Bitfinex's ability to recover the money will depend largely on if they were properly served with the seizure notice, and what they did to that customer's account.

Worse case scenario, if Bitfinex was properly served, but they eventually successfully processed a withdrawal for the customer despite the seizure notice, they will be on the hook for the entire $370M, and this money is in fact gone. If the customer for example withdrew bitcoin, deposited the bitcoin to binance for example, and binance properly froze access to the money, Bitfinex *might* be able to get the $370M back, but I am not an expert in this area, and am not explicitly sure.

A best case scenario is Bitfinex froze this customer's account and the account is currently containing at least $370M. In this case, Bitfinex could simply administratively debit the customer's account to cover the difference, and the customer could try to recover the money from Poland themselves if they have a legitimate claim to it.

If Bitfinex was not properly served with a seizure notice, and let the customer withdraw, the case becomes more complicated, and potentially will be drawn out.

CryptoCapital was laundering Colombian cartel money
Strange is that it was maybe still is 800 mln $
USA didn't blacklisted his offshore like Europe did
There was a lot of information released by Paradise Papers about Crypto Capital Polish Bank and Bitfinex
It is enough for US authorities to look there and ask journalists
But USA is keeping his offshore because his banks need them

$370M of the missing money has been frozen by Polish authorities last year, due to someone using either Bitfinex or Crypto Capital to launder drug money. So technically that part of the money hasn't been 'lost', but seeing how long and drawn-out legal cases can become, years can pass before the funds will be returned.

The statements released by the AG and Bitfinex are indeed of conflicting nature, yet I for one thinks that Bitfinex is on the wrong here due to the nature of its relationship with Crypto Capital. No contracts whatsoever are binding their relationship with each other, and one party, Crypto Capital, can just run away with the money and Bitfinex can't do something about it. As for operations, many traders have already been pulling out assets from the exchange in question, and could potentially lead to its closure just months after this case was filed.

Poor finex, but they had it coming anyway.

There is not criminal case yet
Case like that on court can take years
But for sure it will be used to influence bitcoin price
We had now kind of chaos. Traders are mostly removing his coins from finex
And moving from Tether to fiat or other stable coins

There is also yet another case at New York court that time against JP Morgan Chase
very interesting to read


https://www.ccn.com/federal-judge-rule-crypto-is-cash-chase-bank-lawsuit

https://youtu.be/cwDVjIRkklU

The NYAG say Bitfinex believes the cash was stolen. Bitfinex in their statement say "we have been informed that these Crypto Capital amounts are not lost but have been, in fact, seized and safeguarded". These two statements conflict with one another.

At the end of the day, if Bitfinex does not get this money back, I don't believe they will be an ongoing concern. They made an estimated $6 million in the past 30 days in operating profits, but half that will need to go to interest for the Line of Credit. At this rate, it will be years before the losses are recuperated.

https://finance.yahoo.com/news/ny-attorney-general-sues-bitfinex-210643545.html

Here is the affirmation document:

https://iapps.courts.state.ny.us/fbem/DocumentDisplayServlet?documentId=vIexA1b0spKOnK_PLUS_ZUGTJ3A==&system=prod

Bitfinex official response from the allegation, here.