New York court allows Bitfinex/Tether investigation to proceed
A New York appellate court upheld the attorney general's authority to continue investigating Bitfinex and Tether under the Martin Act.
On July 9, New York's Appellate Division rejected iFinex's effort to halt Attorney General Letitia James's investigation of Bitfinex and Tether. The court held that the attorney general had authority to investigate potential fraud affecting New York residents.
The investigation centered in part on whether representations about Tether's reserves and Bitfinex's access to customer withdrawals were truthful after Bitfinex lost access to hundreds of millions of dollars held through Crypto Capital.
The ruling did not decide that Bitfinex or Tether had committed fraud. It was a procedural and jurisdictional victory for the attorney general that kept a market-structure investigation alive in an ecosystem where USDT had become deeply intertwined with Bitcoin trading liquidity.