Celsius requested that a U.S. court compel Tether to surrender a total of 57,428.64 bitcoin on Friday.
Tether, the organization responsible for USDT, the world’s largest stablecoin by market capitalization, has declared that it will defend itself against the “shakedown” litigation initiated by the insolvent crypto lender Celsius.
In a court filing on Friday, Celsius requested that the U.S. Bankruptcy Court of the Southern District of New York either order Tether to relinquish a total of 57,428.64 bitcoin (BTC) or award the “present value of all Bitcoin,” which is approximately $3.3 billion at the current price.
Tether issued a statement on its website that stated, “This lawsuit astonishingly now seeks the recovery of approximately US$2.4 billion worth of BTC from Tether, despite the BTC being liquidated at Celsius’ direction and with Celsius’ assent at June 2022 prices.” Tether declined to disclose the methodology they employed to arrive at the $2.4 billion figure.
The lawsuit pertains to a loan agreement between Celsius and Tether that permitted Celsius to borrow stablecoins “to operate certain essential aspects of its business.” Celsius alleges in the filing that Tether protected itself from the impending bankruptcy by conducting “preferential and fraudulent transfers” of bitcoin during the “ninety-day period prior” to Celsius’ bankruptcy filing, after the market collapsed in mid-2022.
“Tether demanded and received a substantial quantity of new, incremental collateral on numerous occasions in order to enhance its position in the impending bankruptcy,” according to the lawsuit.
In a post on X, Tether CEO Paolo Ardoino claimed that “this litigation is false and that we should return the bitcoin that were sold to cover Celsius’ situation.” “The claimant’s filing is filled with shortcomings, and we are exceedingly confident in the integrity of our contract and our actions. Legal proceedings regarding this lawsuit will continue until conclusion. It is crucial to serve as an example for the entire industry by demonstrating that blatant money demands are not viable.”
Celsius contended that Tether “applied Celsius’s Bitcoin against obligations owed to it for an average price of $20,656.88 each” in June 2022, which was “considerably less than Bitcoin’s market closing price of $22,487.39 on June 13th.”
According to the filing, it is imperative to prevent these fraudulent and preferential Bitcoin transfers and to retrieve the Bitcoin or its value for the benefit of Celsius’s estate. Additionally, it requests $100 million in compensation for contractual transgressions.
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