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Bitfinex in conjunction with EOSFinex, its decentralized trading platform, have announced that they had successfully completed a "chainswap" to convert $5 million worth of Tether stablecoins onto the EOS blockchain protocol.

Bitfinex claimed Friday that it was the "victim of a fraud" at the hands of Crypto Capital, a payment processor that allegedly lost $880 million of Bitfinex's money. Crypto Capital's president, Ivan Manuel Molina Lee, was arrested Thursday by Polish police on charges of money laundering.

This filing is reportedly only the latest part of Bitfinex' ongoing initiative to recover $880 million that were held at Crypto Capital when the payment processor was seized by authorities in Poland in April of last year as part of a money-laundering investigation.

Bitfinex now allows its customers to borrow Bitcoin (BTC) collateralized by three major fiat currencies (USD, EUR and JPY) and Tether (USDT). They will also be able to borrow Ethereum (ETH) against USD the borrower holds on the platform. Customers will be able to obtain BTC loans of up to 80% of the value of their USD, USDT or EUR holdings, or up to 70% of the value of their JPY holdings. Customers using the platform to borrow ETH will be able to get up to 80% of the value of their USD holdings. At launch, the annual percentage rate on BTC loans was 4.16%, and 1.14% on ETH loans.

"This is far from an exhaustive look at Tether (I'm working on a book with CasPiancey for that), but hopefully you have a better understanding of the context surrounding the claims of fraud that frequently follow Bitfinex and Tether."

Bitcoin miners need cash to pay their electricity bills. They could sell their rewards on exchanges which someone would have to buy, to prevent BTC from crashing. Tether and Bitfinex have real money from those who trade on its exchange, but why would they buy miners' BTC, when they can loan them the money instead? And if a miner defaults, it's not Tether the company that takes the hit, but USDT holders. Maybe that's the real reason why Tether/Bitfinex don't want an audit. Not because USDTs aren't backed, but because they're backed by miners' BTC. And because Tether controls the miners, they also control Bitcoin.

"Today, Ilya Lichtenstein and Heather "Razzlekhan" Morgan pled guilty to money laundering charges related to their role in laundering over 120,000 Bitcoin stolen from the cryptocurrency exchange Bitfinex in 2016. In addition to admitting to the laundering today, Lichtenstein also admitted to executing the hack on the exchange. This is the first time Lichtenstein has been publicly identified as the hacker. No sentencing date was set at the plea hearing due to the ongoing cooperation of the couple."

"The New York Attorney General's office has alleged that crypto exchange Bitfinex lost $850 million and subsequently used funds from affiliated stablecoin operator Tether to secretly cover the shortfall."

What does QuadrigaCX, the Canadian exchange that recently lost $190 million in users' funds and Bitfinex, which lost $850 million in funds, have in common? They both relied on a shady Panama "bank," Crypto Capital, to handle payment processing.

In what seems to be one of the greatest crypto scandals 2019 has seen so far, the United States Attorney General in New York accused Bitfinex of using Tether's cash reserves to cover a rumored $850 million funding gap with reserves meant for backing the stablecoin. Both companies share the same owner.

Beleaguered Bitfinex may soon issue a proprietary exchange token. The issuance method could be similar to that of other exchange tokens, which were distributed through pre-paid trading fee packages.

Bitfinex has released the official white paper for its $1B exchange token sale, said it will also launch a dedicated platform for projects to raise funds via similar initial exchange offerings.

New details are emerging about a planned $1B token sale by iFinex, the parent company of Bitfinex and Tether, who are being sued by the state of New York for covering up a $850M loss in customer funds.

As speculation and impatience arises over the upcoming Bitfinex token sale, opportunistic fakers are creating bogus white papers that purport to describe the details of the upcoming sale. Why? To scam potential buyers out of their cash.

The Bitfinex probe has laid bare two fundamental weaknesses in crypto infrastructure as a whole: 1) the lack of high-level banking services; and, 2) the lack of auditing standards.

Our previous post in November last year provided compelling empirical evidence that USDT printing was used by Bitfinex to manipulate the BTC/USD price upwards during the fourth quarter of 2017. And until the current allegations are proved one can only conjecture, but we conclude that the crypto market is now entering its second tether bubble.

Bitfinex started publishing real-time liquidation updates in preparation for the rollout of its new derivative product with up to 100x leverage, which is not uncommon, with BitMEX also offering it.

The New York Attorney General is investigating Bitfinex, Tether and various associated iFinex companies - on the basis, amongst other reasons, that there's been funny business with the Tether "reserve".

Bitfinex shareholder and over-the-counter (OTC) trader Zhao Dong has revealed that Tether is planning to launch a cryptocurrency backed by the Chinese renminbi.

"After dropping substantially for several hours on Sunday, the BTC spiked eight percent. This major move coincidentally happened just as $40 million worth of Tether tokens (USDT) moved to Bitfinex.