Celsius exchange has sued Tether, alleging misappropriation of holdings and requesting nearly $3.5B in BTC returns and legal fees.
The assets in issue were provided to Tether as collateral. According to Tether, Celsius exchange requests the recovery of approximately $2.4 billion BTC in its lawsuit. Nevertheless, Celsius has requested relief from the court in the amount of 57,428.64 BTC or its current market dollar equivalent, in addition to legal fees and damages, as evidenced by publicly available court documents.
Celsius Exchange is suing Tether
The lawsuit claims that during its bankruptcy proceedings, Tether provided Celsius with a specific quantity of USDT (the company’s stablecoin, a cryptocurrency supported by the US dollar). Celsius provided Tether with 39,542.42 BTC in collateral as payment for this loan.
Celsius was obligated to provide additional collateral to prevent liquidation as the price of Bitcoin declined, as stipulated by the two parties’ agreement.
Celsius exchange alleges in the lawsuit that Tether liquidated the BTC at a price that nearly matched the debt without providing it with the opportunity to provide additional collateral.
Tether Responds to the Lawsuit
The lawsuit is groundless, according to Tether. The company referred to the proceedings as a “shakedown” and vowed to “vigorously defend” itself against “unwarranted allegations” in a recent blog post.
According to Tether, Celsius requested the selloff after they declined to provide additional collateral rather than violating their contract by liquidating Celsius’ position.
“When Celsius chose not to post additional BTC it directed Tether to liquidate the BTC collateral Tether held in order to close out its roughly 815 million USD₮ position with Tether.”
Tether has been unequivocal in its dedication to opposing the lawsuit but has also been prompt in providing USDT stakeholders with assurance. The company asserted that “Tether token holders will not be impacted” in the most remote scenario, which this baseless litigation will resolve, citing its $12 billion in consolidated equity.
There is Losses
As previously indicated, the precise amount that Celsius is seeking appears uncertain. The figure presently reported in the crypto community and cited in Tether’s blog post is 39,542.42 BTC, approximately $2.4 billion as of August 10.
Nevertheless, the plaintiffs seek to void two additional transfers executed during the same period, as indicated on page 28 of the legal filing.
The plaintiffs request that the court “require Defendants to relinquish to Plaintiffs the 15,658.21 Bitcoin, 2,228.01 Bitcoin, and 39,542.42 Bitcoin preferentially transferred by Plaintiffs to Defendants” or their current dollar value as part of the suit’s “prayer for relief.”
The sum of these three transfers is 57,428.64 Bitcoin. Celsius is seeking approximately $3.48 billion in Bitcoin for $60,627 per BTC as of August 10.
Additionally, the Celsius lawsuit claims a minimum of $100 million in damages, “additional damages to be determined at trial,” and legal fees.
