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Bitfinex reveals stablecoin is only 74% backed by cash, says it’s ‘simultaneously addressing’ requests from NYAG, DOJ and CFTC

by Celia Wan

April 30, 2019, 5:38PM EDT  ·  2 min read

Quick Take

  • Tether’s general counsel said in an affidavit that its stablecoins are only 74% backed by cash reserves, and it knowingly did not disclose this information to its customers
  • The Department of Justice and the CFTC were also requesting information from Tether and Bifinex, during the New York Attorney General’s office investigation
  • NYAG made several attempts to obtain detailed documents on the transaction records between Tether and Bifinex without receiving satisfactory answers

by Celia Wan

April 30, 2019, 5:38PM EDT  ·  2 min read

In an affidavit released Tuesday, Stuart Hoegner, general counsel for Tether, revealed that only 74% of its stablecoins were backed by its cash reserves, claiming the company knowingly did not disclose this information to its customers.

Hoegner wrote that Tether currently has cash or cash equivalent of around $2.1 billion, representing around 74% of its current outstanding stablecoins.