- Celsius Network court filing notes that Tether, the issuer of stablecoin USDT, has improperly liquidated 57,428 Bitcoins.
- Following the lawsuit, Tether wrote on X that it is ready to defend itself from “Shake Down.”
- FTX’s sudden downfall is also one of the reasons for the collapse of the Celsius Network, as per claims.
In the history of the cryptocurrency market, 2022 is considered one of the most disastrous years, leading to a wipeout of hundreds of billions in crypto. Celsius Network, a collapsed crypto lender, filed for bankruptcy in July 2022.
Why Celsius Network Filed Lawsuit Against Tether?
As per Celsius’s court filing, Tether, the issuer of stablecoin USDT, has improperly liquidated 57,428 Bitcoins. The crypto lender has provided 39,542.42 BTC as collateral for loans from Tether, says the filing.
On August 09, 2024, court filing Celsius Network demanded $3.5 Billion in Bitcoin as damages and legal fees. The lawsuit by the firm is filed in the United States Bankruptcy Court for the Southern District of New York.
The lender contends that Tether sold the Bitcoin at an average price of $20,656.88, which was considerably below the low price of $22,808 that BTC reached on Bitfinex, a centralized crypto exchange controlled by Tether’s parent company.
The USDT issuer terms the case a “shakedown” and dismisses it as “baseless,” vehemently denying any wrongdoing.
Tether’s Take Over the Lawsuit by Celsius
In an X post dated August 10, 2024, Tether notes that it is ready to defend itself from the “Shake Down” lawsuit filed by Celsius Network.
Paolo Ardoino, the chief executive officer of Tether, wrote in his X post, “This baseless lawsuit is trying to claim that we should give back the Bitcoins that were sold to cover Celsius’ position.”
Additionally, Paolo notes, “There are plenty of flaws in the claimant’s filing and we’re very confident in the solidity of our contract and our actions … This lawsuit will be fought till the end. It’s important to set an example on behalf of the entire industry that shameless money grabs will not work.”
What Lead Celsius Network Bankrupt?
In mid-2022, the market was at the peak of volatility, leading to a decline of 65-70% in Bitcoin and Ethereum prices, affecting the total crypto assets held by the Celsius Network and leading to the failure to process customers’ withdrawals.
The collapse of FTX significantly contributed to Celsius’s bankruptcy, dealing a devastating blow to the company’s financial stability.
By freezing customer withdrawals in June 2022, Celsius sparked a crisis of confidence and actively rushed its bankruptcy, noting “extreme market conditions” as the reason.
FTX allowed Celsius to manipulate CEL token markets by enabling the purchase of over 40 million CEL tokens, which Celsius used to artificially drive up and maintain the CEL price, coinciding with their $750 million equity raise from Westcap and La CDPQ.
Crypto Market Price Alert
In the past 24 hours, the global crypto market capitalization has bled 4.07%, reaching $2.06 trillion. The market’s trading volume surged by 61.78%, despite a decline in market cap, with traders and investors actively driving up the volume.
Despite an injection of over $104 Million in the ETH ecosystem following the approval of Ether spot ETFs, Ethereum’s price fell 1.82% intraday. Bitcoin price lost support above $60k and 4.03% in the past 24 hours, reaching $58,337 as of press time.
The fear and greed index powered by CoinMarketCap is at 50, reflecting neutrality in the sentiments.
Sui (SUI) tops the intraday gainers’ list as its price grew 11%, reaching $0.9878, followed by Helium (HNT), Aave (AAVE), Aptos (APT), and Lido (LIDO). In the past 24 hours, MANTRA (OM) bled over 8.50%, reaching $0.9741.
