A large portion of the cryptocurrency community still distrusts Bitfinex. This is primarily due to allegations regarding the company’s hack, which resulted in an $850m hack. Whereas many people expected documents regarding this incident to be made public, that will no longer be the case. Rest assured speculation will continue to run wild in this regard. The company’s public perception isn’t too great right now, and this won’t do much to improve upon that situation.
Bitfinex Hacked for $850m
For those who are not too sure about what has happened to Bitfinex quite some time ago, the company suffered from a massive hack. Cryptocurrency exchanges and trading platforms are a massive target for criminals looking to score a quick buck. Given the popularity of Bitfinex at that time, it was seemingly a matter of time until criminals took a legitimate interest in this company’s assets. When that interest materialized, the culprits made off with $850m in assets.
Or that is what the company wants people to believe. From day one, there has been plenty of speculation as to how this theft might never have happened in the first place. These concerns were so grave the NYAG even showed an interesting in finding out what happened exactly. Parent company iFinex was seemingly on the hook to effectively disclose all the documentation related to this hack and make it public. That will no longer happen, although it doesn’t necessarily make this incident more legitimate either.
Jurisdiction Remains Iffy
There are several reasons as to why IFinex opposed the NYAG’s plan from day one. First of all, the company is convinced the New York Attorney General has no jurisdiction over their day-to-day business. While there may be some truth to that statement, it doesn’t change the fact that the company was under investigation for potential wrongdoings. Secondly, the company didn’t want to disclose sensitive information regarding Bitfinex or Tether, the other “partner” of grave concern in this entire debacle.
That being said, there are genuine reasons as to why this information needs to be handed over regardless. The main point of contention is the involvement of Tether. That company is as controversial as they get in the cryptocurrency industry. Tether’s cash reserves have been in question for several years now, and may expect the Bitfinex “hack” to be a happy accident in that regard. Whether or not there is any truth to those conspiracy theories may never be proven. The lack of transparency in this regard remains a pressing problem which will need to be addressed regardless.
The Future of Bitfinex
This news regarding the popular exchange is a double-edged sword. On the one hand, the firm can claim a victory over the legal system in the US. Not having to dance to the tune of the NYAG is a moral victory in its own right. It is also a somewhat positive sign for the cryptocurrency industry, as this sets a precedent for other companies which might head down a similar path in the future.
That being said, it will only fuel the controversy surrounding both Bitfienx and Tether even further. Neither company is a blank slate by any means. Now that the parent company is getting away with this ordeal once again, one has to wonder how the public sentiment will evolve. A very interesting era dawns upon Bitfinex and Tether, but no one knows for sure if it is for better or worse.