Celsius Sues Tether, Demands $2.4 Billion in Bitcoin Compensation
Tether claims that Celsius's demand for $2.4 billion in Bitcoin is baseless and will fight the legal battle to the end.
On the evening of August 10, stablecoin issuer Tether posted a blog post, revealing that it had just been sued by bankrupt cryptocurrency lending company Celsius, demanding $2.4 billion in compensation.
Tether Will Defend Itself Against “Shake Down” Litigation Commenced by Celsius
Learn more: https://t.co/6qjXD84EXh— Tether (@Tether_to) August 10, 2024
Specifically, on August 9, Celsius filed a lawsuit against Tether in the Bankruptcy Court of the Southern District of New York (USA). Celsius claimed that before the company went bankrupt in July 2022, they had pledged BTC at Tether to borrow USDT. When Bitcoin prices plunged in May and June 2022 due to the collapse of LUNA-UST and the subsequent liquidity crisis, Tether demanded that Celsius increase its collateral to maintain the loan.
Celsius refused to add collateral, forcing Tether to liquidate the BTC to avoid losses.
However, Celsius did not agree to the above settlement in August 2024, and instead used legal pressure to force Tether to return $2.4 billion in Bitcoin.
Tether claimed that Celsius's demand was unreasonable, as the company had agreed to be liquidated at that time. The stablecoin issuer argued that this was simply an attempt by the Celsius acquirer to prolong the bankruptcy period to collect more service fees, so Tether will fight to the end and is ready to take the case to court.
Not stopping there, Celsius also filed a lawsuit against Badger DAO, Compound, and Bancor for past incidents that have caused damage to the company.
Along with suing tether yesterday, TIL that the Celsius debtors are also suing the BadgerDAO founder (for the phishing incident in Dec 21), Bancor DAO/Foundation (for the impermanent loss protection 'pause'), and Compound Labs (for the DAI oracle rug that also happened in 21)
— Spreek (@spreekaway) August 10, 2024
https://t.co/dmoBC8kdMH Bancorhttps://t.co/m4cMOEUBBS Badger DAO founderhttps://t.co/iJtl8rdZkr Compound
— Spreek (@spreekaway) August 10, 2024
Celsius Network is a US-based crypto lending company that has served a large number of customers. In the summer of 2022, following the collapse of the LUNA - UST model, the cryptocurrency industry was dragged into a liquidity crisis, exposing the overlapping relationships between many organizations. After the Three Arrows Capital fund and the lending unit Voyager went bankrupt, Celsius also succumbed to the pressure to withdraw money from users and had to declare bankruptcy in July.
Since February this year, the process of returning assets to customers, with a value of about $ 3 billion, has begun. However, in a very surprising development, the company in July sued 1,500 customers, demanding to recover $ 100 million in assets withdrawn before the company went bankrupt, but with a very "unreasonable" time frame.
Meanwhile, Tether has just announced its financial report for the first half of 2024, with a profit of up to $ 5.2 billion and total assets under management reaching $ 118.4 billion.
