Bitfinex’s Parent iFinex Files A Discovery To Access $880M In Frozen Funds Under Crypto Capital

The never ending Bitfinex and Tether (USDt) drama continues

Bitfinex’s exchange parent company, iFinex Inc, recently filed a discovery application in South Carolina’s District Court in a dispute over its $880 million funds held by Crypto Capital.

The past year’s regulatory pressures have been a big challenge to crypto players and now trickle-down effects are being experienced within the digital asset economy. Crypto Capital which was mandated to handle Bitfinex’s funds and transactions to surpass various barriers claims the funds have been frozen since December 2018.

According to the filings, Bitfinex wants access to documents that prove its contractual agreement with Crypto Capital. The British Islands based firm further intends to leverage U.S litigation to get the deposition documents through the standard discovery avenues to access its $880 million.

Reports by Bitfinex on the issue highlight that the funds are held up in U.K, U.S.A, Poland and Portugal bank accounts. As it stands, Bitfinex is a target of the New York Attorney general office on allegations of non-disclosure of information. The crypto consortium allegedly borrowed money from a sister company to meet its liquidity needs without informing it's clients of the regulatory risks which currently have its funds frozen.

This situation between Bitfinex and Crypto Capital had been a good business relationship that only turned sour in April 2018 following an asset freeze in Poland for money laundering investigations. Crypto Capital’s association with Reginald Fowler also triggered reaction from authorities given he is under investigation for bank related fraud. Bitfinex defended its due diligence noting that they had been unaware of this relationship until the end of 2018.

The discovery will target access to Crypto Capital bank accounts’ information. So far, Bitfinex has identified big players like Citi, HSBC, Bank of America and Well Fargo among the key intermediaries whose account information can help trace the funds held in the U.K, Portugal and Poland.

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Lujan Odera
Lujan Odera
Lujan is a blockchain technology and cryptocurrency author and editor. He has worked in the field of cryptocurrencies and blockchain technology since 2015 helping him gain enough experience to be the writer he is today. He is known for his simple writing style that allows novices to understand the field in the simplest way.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer


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