Celsius, the now-defunct cryptocurrency exchange, has launched a legal battle against Tether, accusing the stablecoin issuer of misappropriating assets and seeking approximately $3.5 billion in Bitcoin (BTC) returns, damages, and legal fees. The lawsuit stems from allegations that Tether liquidated Celsius’ BTC collateral during the exchange’s bankruptcy without allowing it the opportunity to provide additional collateral.
According to Celsius, Tether was holding 39,542 BTC as collateral for a loan. When Bitcoin’s price plummeted, Celsius claims it was required to post more collateral to prevent liquidation. However, Celsius alleges that Tether prematurely sold off the BTC, covering its debt but depriving Celsius of the chance to protect its assets.
Tether, on the other hand, has dismissed the lawsuit as baseless. The company insists that Celsius itself requested the liquidation after failing to post additional collateral. In a blog post, Tether labeled the lawsuit a “shakedown” and vowed to defend itself against what it calls “unwarranted allegations.”
The legal dispute centers around not only the 39,542 BTC but also additional Bitcoin transfers made by Celsius during the same period. Celsius is now seeking the return of 57,428 BTC, valued at around $3.48 billion, plus a minimum of $100 million in damages and further damages to be determined at trial.
Tether has assured its stakeholders that even in the unlikely event the lawsuit succeeds, it has sufficient equity to ensure that USDT holders will remain unaffected.
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