Blockchain and Cryptocurrency: People, Culture and Tech
When a powerful international financial oversight body releases a report on “so-called stablecoins,” you just know it isn’t going to be comfortable reading.
Cryptocurrency exchange Bitfinex did business with New York-based customers and vendors as recently as this May, according to a filing made in State Supreme Court by the office of New York Attorney General Letitia James.
Part of Bitfinex’s “missing” $850 million is now in the hands of the U.S. Department of Justice. Meanwhile, a controversial businessman was arrested for falsely setting up accounts that let exchanges—including Bitfinex, based on claims in the indictment—skirt bank rules and the law.
Tether advocates rejoiced on Tuesday after a story by Bloomberg’s Matt Leising seemed to reassure readers that the stablecoin had enough dollars to back each token. “Bank statements reviewed by Bloomberg News suggest those fears may be unfounded,” Leising wrote. The story’s big contribution to the Tether debate was only that Bloomberg saw four separate months’ worth of Tether’s balances and each exceeded the amount of circulating tokens. Yet Tether’s bank balances should be expected to be positive at month’s end. As written in the often-cited study by John Griffin and Amin Shams of the University of Texas on alleged manipulation of Bitcoin prices using tethers: “the strong negative effect on…
