Celsius Network Files Lawsuit Against Tether: What You Need to Know
Celsius Network, a bankrupt crypto lender, has taken legal action against Tether, the company responsible for the popular stablecoin USDT. Here are the key points you should be aware of regarding this lawsuit:
Details of the Lawsuit
- The lawsuit was filed in the U.S. Bankruptcy Court for the Southern District of New York on August 9, seeking approximately $3.5 billion in Bitcoin returns, damages, and legal fees.
- Celsius claims that Tether improperly liquidated 57,428.64 of its Bitcoin collateral without allowing enough time to provide additional funds.
According to Celsius, they had initially provided 39,542.42 BTC as collateral for loans from Tether. When Bitcoin prices fell in early 2022, Tether requested more collateral. Celsius complied with the first request but alleges that Tether liquidated the entire collateral without giving the agreed-upon 10-hour response time for the second demand.
- If given the full time as per the contract, Celsius believes they could have avoided selling their Bitcoin at a low price point.
Tether’s Response
Tether has denied any wrongdoing, dismissing the lawsuit as baseless and a shakedown. They insist that they acted within the terms of the agreement in place with Celsius, which required additional collateral when Bitcoin prices dropped.
- Tether maintains that when Celsius did not provide more BTC as requested, they were within their rights to liquidate the collateral to settle Celsius’ position.
Legal Battle in the Crypto Industry
As Celsius seeks to recover funds for its creditors following its bankruptcy filing, this lawsuit is part of a series of legal actions taken by the company against various crypto entities like Badger DAO, Compound Labs, and Bancor DAO.
- With $5.5 billion in liabilities against $4.3 billion in assets, Celsius’ bankruptcy has been a significant event in the crypto space.
- Former CEO Alex Mashinsky is also facing federal charges and civil suits in connection with the collapse of Celsius.
Stance of Both Parties
As the legal proceedings unfold, Celsius is determined to recover funds for its creditors through these lawsuits, while Tether remains confident that its actions were in line with the agreement and instructions provided by Celsius.
Hot Take: Conclusion on Celsius Network vs. Tether Lawsuit
Stay informed about the ongoing legal battle between Celsius Network and Tether as they navigate through this complex issue. Keep an eye on how this lawsuit progresses and its potential impact on the broader crypto industry.
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