Tether to Fight Celsius’ $3.3 Billion “Cash Grab” Lawsuit

Tether, the company behind USDT, the world’s largest stablecoin by market value, has announced that it will defend itself against a “money-grabbing” lawsuit filed by bankrupt crypto lender Celsius.

Celsius notified the U.S. Bankruptcy Court for the Southern District of New York on Friday that it has requested Tether to forfeit a total of 57,428.64 bitcoins (BTC).

“Incredibly, this lawsuit now seeks the return of approximately $2.4 billion worth of BTC from Tether, despite the fact that BTC was liquidated at June 2022 prices at the direction and with Celsius’ consent,” Tether wrote in a statement on its website. Tether did not explain how it calculated the $2.4 billion figure.

“Tether requested and received significant new, increased collateral to improve its impending bankruptcy position,” according to the lawsuit.

Tether CEO Paolo Ardoino countered: “This baseless lawsuit claims that we should have returned the bitcoin sold to protect Celsius’ position. The plaintiff’s case is full of flaws and we are confident in the integrity of our contract and actions… This case will be fought to the end. The entire industry must see that shameless attempts to extort money will not work.”

” style=”height: 699px;”>

Celsius argued that in June 2022, Tether “owed Celsius bitcoins at an average price of $20,656.88 each, far less than bitcoin’s market closing price of $22,487.39 on June 13.”

According to Tether, the deal required “Celsius to post additional collateral to prevent the liquidation of its BTC” during a major market crash, and “when Celsius chose not to post additional BTC, it forced Tether to liquidate the BTC collateral held by Tether.”

It was also emphasized that Tether Group’s consolidated equity capital was approximately $12 billion as of June 30, so “even in the most likely scenario where this baseless lawsuit goes somewhere, Tether token holders will not be affected.”