BITCOIN CRASH Incoming with this Lawsuit?? Deep Dive

Jan 14, 2021

🏖Crypto Capital Corp🏖

Back in the day, the go-to shadow bank for cryptocurrency exchanges was a company called Crypto Capital Corp. Crypto Capital Corp is said to have worked with just about every cryptocurrency exchange in the space at some point in time, and also provided financial services to Tether.

🕵️‍♂‍iFinex, Bitfinex, Tether🕵️‍♂‍

Tether, which issues the USDT stablecoin, is the sister company to Hong Kong cryptocurrency exchange Bitfinex which launched in 2013. Both are owned by a company called iFinex, which is also based out of Hong Kong and was founded in 2012. Tether, Bitfinex, and iFinex all have overlapping executives. Wells Fargo and a few other big banks severed ties with Bitfinex in early 2017, citing questionable financial practices by the exchange. This prompted Bitfinex to turn to Crypto Capital Corp. Bitfinex stored over 850 million dollars of their corporate and user funds with Crypto Capital Corp, which somehow lost every single penny.

⚖Tether Fraud Lawsuit⚖

An investigation by the New York AG found that Bitfinex used Tether’s bank balance to fill the 850-million-dollar gap left by Crypto Capital Corp, and that this transaction was facilitated and orchestrated by their parent company, iFinex. In December 2019, Bitfinex and Tether apparently handed over more than 70 thousand documents to the New York AG, and seem to have decided to start handing over the real documents following a virtual hearing in September 2020. The Supreme Court will begin examining the documents after January 15th, 2021.

📉Tether Price Manipulation Lawsuit📈

A price manipulation lawsuit was filed in October 2019 by five cryptocurrency traders who allege that cryptocurrency exchanges, namely Bitfinex, used Tether’s USDT stablecoin to manipulate the cryptocurrency market during the 2017-2018 bull run. The people behind the market manipulation suit against Tether seem to be looking to settled. This is because they reduced their initial 1.4 trillion dollar suit down to a ‘reasonable costs of suit, pre- and post-judgment interest, and reasonable attorneys’ fees’.


If the Stable Act is passed, it would instantly make all stablecoins illegal, and would require stablecoin issuers to receive approval from the Federal Reserve and a handful of other government agencies if they want to resume operations. In addition, stablecoin issuers would have to obtain a banking charter, follow banking regulations, require any company using their stablecoins to cough up KYC information about their users, and keep all of the US dollars backing their stablecoins tokens at the Federal Reserve itself.

😨USDT Ban Effects😨

If USDT was banned in the United States, that ban would likely only apply to cryptocurrency exchanges based in the United States. The USDT liquidity lost on those exchanges would transfer over to stablecoins like USDC and DAI, which are already projected to surpass USDT, and after a couple of turbulent weeks the crypto markets would recover.


📜 Disclaimer 📜

The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading cryptocurrencies poses considerable risk of loss. The speaker does not guarantee any particular outcome.