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Celsius accused Tether of cheating in a 2022 contract in which Tether provided USDT to Celsius with BTC as collateral. Tether has denied any wrongdoing, calling the lawsuit baseless and a “shakedown” attempt to recoup losses from Celsius’ mismanagement.
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Tether, the issuer of stablecoin USDT, has hit back at Celsius Network in response to a lawsuit filed against the company on Friday. Tether called the matter a “shakedown” attempt to shift responsibility for Celsius’ financial mismanagement to Tether.
According to a recent Tether blog post, in 2022, the company and Celsius entered into an agreement in which Celsius will borrow USDT from Tether using Bitcoin (BTC) as collateral.
When BTC prices fell, Celsius refused to provide additional collateral as called for in the agreement. Subsequently, if Celsius failed to meet its obligations, Tether liquidated the BTC collateral in accordance with the terms of the agreement, the company explained.
Celsius is currently suing Tether through the Blockchain Recovery Investment Consortium for wrongful liquidation. Celsius is demanding approximately $2.4 billion in BTC compensation from Tether, but the stablecoin issuer claims the lawsuit is baseless and vows to defend itself.
“Tether will never fall prey to money-making schemes through shameless litigation. We will vigorously defend against unjustified claims and look forward to prevailing in this lawsuit,” Tether said. .
Tether CEO Paolo Ardoino, in a post on did.
He said that even if the lawsuit progresses, USDT holders will not be affected due to Tether’s strong financial position with nearly $12 billion in equity capital.
“When it comes to the safety of USDT users, which is undoubtedly our top priority and obligation, Tether Group has nearly $12 billion in capital. Even in a remote scenario, USDT token holders will not be affected,” Ardoino said.
Celsius Network, once one of the leading crypto lenders, emerged from bankruptcy earlier this year after completing transactions under a confirmed restructuring plan that included distributing more than $3 billion in cryptocurrencies and cash to creditors. I broke away.
As part of its exit from bankruptcy, Celsius’ creditors also received shares in Ioniq Digital, a bitcoin mining company founded in February. Ionic has mined over 1,300 BTC since its inception and currently holds over 1,800 BTC, the company said in a recent press release.
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