Tether responds to account deactivation controversy

Tether responds to claims that it deactivated the accounts of major crypto firms, including MoonPay. According to documents released by the New York Attorney General (NYAG), Tether reportedly deactivated approximately 29 accounts belonging to prominent cryptocurrency players in 2021.

Tether responds to account deactivation controversy

Tether, the company behind the market-leading stablecoin USDT, has deactivated the accounts of 29 prominent cryptocurrency players. The accounts were deactivated in 2021, according to documents released by the New York Attorney General (NYAG).

The NYAG investigation into Tether concluded in February 2021, but some documents from the investigation extend until June of that year. The documents show that Tether deactivated the accounts of MoonPay, BlockFi, CMS Holdings, and Galois Capital.

Tether has not disclosed the reasons for the account deactivations. However, the company said that all individuals who had their accounts deactivated had undergone rigorous compliance checks during onboarding, as well as ongoing monitoring.

The NYAG investigation into Tether was launched after the company was accused of misappropriating $850 million in funds. Tether and its sister company Bitfinex settled with the NYAG in February 2021, agreeing to pay a penalty of $18.5 million and halt trading activities in New York.

Media outlets and Coinbase have requested that the NYAG publicly disclose Tether’s initial quarterly report under the Freedom of Information Act. However, Tether has objected to this request, citing the need to safeguard its customers’ confidential information.

Despite Tether’s objection, the NYAG has allowed media outlets access to the documents, revealing the deactivation of numerous company accounts.

The implications of the account deactivations are unclear. Some analysts have speculated that the deactivations could be related to Tether’s compliance with regulations. Others have suggested that the deactivations could be an attempt by Tether to distance itself from companies that have been accused of wrongdoing.

Only time will tell what the true implications of the account deactivations are. However, the deactivations have certainly raised questions about Tether’s operations and compliance with regulations.

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