Tether, Bitfinex Stay Afloat Amid Controversy

Those claims have finally been validated by Tether itself as a result of an ongoing legal battle involving cryptocurrency exchange Bitfinex - which shares personnel and ownership structures with Tether - and the Office of the New York Attorney General.

Tether has had an association with Bitfinex since 2015, when the exchange integrated the cryptocurrency operation into its exchange.

Giancarlo Devasini is the chief financial operator of both Tether and Bitfinex.

Bitfinex accused of using Tether reserves to plug losses.

Fast forward to April 2019, an investigation started in 2018 into iFinex, Bitfinex and Tether was revealed by the Office of the New York Attorney General in 2019.

The OAG is also looking to obtain an injunction that will compel Bitfinex and Tether to continue their operations to ensure the stability of the crypto markets and protect its customers.

The markets clearly remain confident in tether, as it currently trades just shy of $1 dollar per U.S. Dollar tether - even after the Attorney General's highly inflammatory and misleading public application.

In March, Cointelegraph had contacted Tether for comment on a change to its website that indicated that tether tokens were no longer backed by only cash but by "Cash equivalents" as well.

"Tether is not operating a fractional reserve. It does not have a banking business lending out reserve amounts to retail customers. Tether's reserves remain, and have always been, 100% backed by its reserves. Tether maintains the ability to honour all redemption requests."

Cointelegraph has reached out to Tether's general counsel, Stuart Hoegner, for comment in relation to the ongoing disputes between these parties and the OAG. As it stands, both companies seem to be continuing with their operations and the OAG has made it clear that it does not wish to harm investors and customers of Tether and Bitfinex during its investigation.