The post Celsius Network Sues Tether To Clawback $2B Bitcoin Lost In Fraud Transfer appeared on BitcoinEthereumNews.com.

Celsius Network Ltd. has filed a lawsuit against Tether and its affiliated entities. The lawsuit alleges that the USDT issued conducted “fraudulent” and “preferential” transfers of Bitcoin (BTC) amounting to over $2 billion today. The complaint, lodged in federal bankruptcy court, seeks to reclaim the collapsed estate’s lost Bitcoin due to the USDT issuer’s actions during a critical period leading up to the firm’s bankruptcy. Despite the lawsuit, Tether CEO Paolo Ardoino has refuted the fraud claims and noted the fight will be underway calling it a “shake down.” Celsius Network’s Allegations Against Tether Celsius Network, a prominent crypto lender, entered into a loan agreement with Tether Ltd. in 2020. This arrangement allowed the lender to borrow stablecoins, specifically USDT and Euro Tether (EURT), at low-interest rates. In return, the crypto lender posted substantial collateral, including Bitcoin, to secure these loans. At its peak, the firm had borrowed nearly $2 billion in USDT, backed by tens of thousands of BTC. The lawsuit focuses on actions taken by the USDT issuer during the ninety-day period before the crypto lender filed for bankruptcy on July 13, 2022. According to the complaint, the USDT issuer demanded and received significant amounts of new collateral from the crypto lender. This totaled 15,658.21 Bitcoin, and further secured new borrowings with an additional 2,228.01 BTC. These actions, characterized as “Preferential Top-Up Transfers” and “Preferential Cross-Collateralization Transfers,” are claimed to have unfairly improved the stablecoin company’s position at the expense of other creditors. Preferential Application Transfer & Breach of Contract On June 13, 2022, the stablecoin firm issued a final demand for additional collateral. The crypto lender, in accordance with their agreement, had 10 hours to respond. However, stablecoin issuer proceeded to apply the entirety of Celsius Network’s collateral, i.e., 39,542.42 BTC immediately, without granting the contractually stipulated…

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Filed under: News - @ August 11, 2024 8:08 am