Tether to Fight Celsius Lawsuit Over Returned Bitcoin
CryptoNewsTerminal Staff10 Aug, 2024
Tether to Fight Celsius Lawsuit Over Returned Bitcoin
Tether, the issuer of the stablecoin USDT, has announced that it will "vigorously defend" a lawsuit filed against it by bankrupt crypto lender Celsius. The lawsuit, filed in the Southern District of New York, alleges that Tether breached its contract with Celsius by liquidating its Bitcoin (BTC) collateral without proper notice. In 2022, Celsius entered into a contract with Tether to borrow USDT against bitcoin collateral. However, when the price of BTC fell in June of that year, it triggered a margin call. Celsius failed to post additional collateral and elected to have its 815 million USDT position liquidated. Tether says it liquidated the BTC at market price in June 2022 "with Celsius's consent." Celsius is now seeking the return of $2.4 billion worth of BTC, claiming that Tether breached its contract by not providing proper notice of the liquidation. Tether has denied any wrongdoing and says it will "vigorously defend" the lawsuit. The outcome of the case could have implications for other crypto lenders who have borrowed against bitcoin collateral.
