{"id":103105,"date":"2019-04-25T16:50:36","date_gmt":"2019-04-25T23:50:36","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=103105"},"modified":"2026-10-18T10:51:52","modified_gmt":"2026-10-18T09:51:52","slug":"tether-bombshell-leads-to-5-wipeout-of-bitcoin-can-the-market-recover","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/tether-bombshell-leads-to-5-wipeout-of-bitcoin-can-the-market-recover\/","title":{"rendered":"Tether bombshell leads to 5% wipeout of bitcoin price"},"content":{"rendered":"

On Apr. 25, the office of New York Attorney General Letitia James alleged iFinex, the company behind Bitfinex<\/a> and Tether<\/a>, of misusing $900 million of Tether\u2019s cash reserves to hide an $850 million loss. Immediately thereafter, the bitcoin price plunged by seven percent against the U.S. dollar.<\/p>\n

On Binance, the world\u2019s largest cryptocurrency exchange, the bitcoin-to-tether (USDT) pair dropped from around $5,500 to $5,102 at the day\u2019s lowest point, recording a 7.2 percent drop.<\/p>\n

Bitcoin has since recovered to $5,233 and is en route to close the day with a 5 percent decline.<\/p>\n

Can the Bitcoin and Crypto Markets Recover?<\/h2>\n

The Tether allegation by the New York Attorney\u2019s office goes further than the short-term price movement of bitcoin and other major cryptocurrencies.<\/p>\n

If Bitfinex did lose $850 million in a transaction the company sent to a company based in Panama called Crypto Capital Corp and granted itself access to $900 million worth of Tether\u2019s cash reserves, it could have a long-lasting effect on the public image of the cryptocurrency market.<\/p>\n

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TL:DR the Tether\/Bitfinex news:
Bitfinex have borrowed ~700mil from Tether
Bitfinex pay a 'fair' interest rate on this loan
60million shares in Bitfinex were pledged as collateral
If CryptoCapital release the USD, no problem
If Bitfinex trades profitably, no problem<\/p>\n

— Alistair Milne (@alistairmilne) April 25, 2019<\/a><\/p><\/blockquote>\n