The Supreme Court of New York fails to make a ruling on Bitfinex case

• The hearings are postponed for at least another 90 days.
• The parties are locked in a legal battle since April.

     
New York Supreme Court Judge Joel M. Cohen hoped to make a final decision in the case of the State Attorney’s Office (NYAG) against the Bitfinex exchange but changed his mind.  It means that a new date of the meeting will be set, and the jurisdictional battle between Bitfinex and NYAG will continue for at least 90 days.

The parties have been locked in a legal battle since April. However, Monday’s hearing was focused on whether the NYAG had the authority to initiate the investigation.
 
NYAG  said that the exchange used the reserves of Tether Limited to cover up a loss of $800 million. It is worth noting that both companies are owned by iFinex Inc.

Also, NYAG believes that the cryptocurrency exchange provided services to the residents of New York and thus violated the Martin Law. However, the company denies the charges. They are convinced that NYAG does not have jurisdiction in the case as it does not serve New York residents according to the terms of service.

 Meanwhile, recently, independent researchers managed to bypass the geoblock and start trading on the platform being NY residents.

Tether Limited really opened a credit line for Bitfinex, and, according to prosecutors, the exchange borrowed about $ 750 million to maintain the liquidity after its own funds were locked in the Panamanian processing center of Crypto Capital Corp.

Meanwhile, Tether Limited emphasized that the updated provisioning policy allows for partial reserves. According to the company, they were not obliged to notify users about loans for Bitfinex, and the exchange itself was allegedly not required to inform customers about liquidity problems.

One way or another, Bitfinex managed to perform IEO for LEO tokens and raise $1 billion. Notably, NYAG said that these tokens might be securities.

iFinex attorney did not ask the court to stop the investigation, but rather to preclude iFinex’s participation.

The prosecution has no answers as to whether Tether is a commodity, security, or foreign currency. The company firmly believes that the USDT does not fall into any of these categories, but the US authorities decide otherwise, the prosecutor’s office will quickly gain the necessary powers.