The US Commodity Futures Trading Commission fined Tether and Bitfinex a total of $ 42.5 million for misleading investor statements and illegal transactions with US citizens.
How
indicated on the website of the US Commodity Futures Trading Commission (CFTC), the agency has settled charges against Tether Holdings Limited, Tether Limited, Tether Operations Limited and Tether International Limited (acting as Tether) for false and misleading statements about pegging the USDT stablecoin to the US dollar … Tether is ordered by the Commission to pay a $ 41 million fine, stop violating the Commodity Exchange Act (CEA) and CFTC rules as charged, and refrain from such violations in the future.
After launching USDT in 2014, Tether has positioned it as a stablecoin, 100% pegged to fiat currencies, including the US dollar and the euro. According to the regulator, from June 1, 2016 to February 25, 2019, Tether provided customers with incorrect information about the reserves that provide USDT. Tether also did not disclose information about unsecured receivables and reserves, which included assets other than fiat currencies. In addition, the company made false claims to conduct regular audits, and also hired unregulated organizations and third parties to hold reserves, the CFTC website says.
In addition, the CFTC has issued a separate settlement order against iFinex Inc, BFXNA Inc and BFXWW Inc (acting as Bitfinex). According to the CFTC indictment, from March 1, 2016 to December 31, 2018, Bitfinex conducted OTC retail commodity transactions using digital assets with US citizens, being an unregistered intermediary in futures exchange transactions, which is contrary to US law. The agency demanded that Bitfinex pay a $ 1.5 million fine, stop violating the Law on Commodity Exchanges, and also introduced additional systems to prevent illegal retail transactions with exchange commodities, to which the regulator classifies cryptocurrencies. The exchange must fulfill these requirements by December 31, 2021.
CFTC Acting Chairman Rostin Behnam said the agency will continue to take steps to identify false and misleading statements that affect markets under the CFTC jurisdiction. CFTC Acting Chief Enforcement Officer Vincent McGonagle added that the regulator will focus on fulfilling its statutory obligations to protect the integrity of the US market and its customers.
“We are making every effort to combat product and digital asset fraud. We will continue to ensure that margin and leveraged trading offered to retail customers in the United States is conducted on listed and regulated exchanges. As the Bitfinex example shows, we are taking strong action against those who violate CFTC regulations, ”McGonagle said.
Recall that in May, Tether first published detailed information on USDT collateral, according to which 76% of USDT was collateralized by traditional currencies and obligations in them.
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