- Celsius Network is attempting to recover these funds.
- Paolo Ardoino, provided a clear account of what happened between them.
In response to Celsius Network’s Bitcoin (BTC) fraud accusation, stablecoin issuer Tether has declined to assume responsibility. The chief executive officer of the company, Paolo Ardoino, provided a clear account of what happened between them.
Celsius Network has sued the USDT issuer and its related organizations, claiming that they were complicit in the company’s insolvency. Based on today’s market value, the stablecoin corporation allegedly transferred Bitcoin worth around $2.4 billion using “fraudulent” and “preferential” means, according to the lawsuit.
Tether Refutes Allegations
Since the stablecoin issuer’s conduct at a crucial time leading up to the firm’s bankruptcy caused the collapsed estate to lose BTC, Celsius Network is attempting to recover those funds. But Ardoino reminisced to paint a picture of what happened in reality. He brought out the fact that Celsius was one of the clients provided USDT by the company.
Its agreement with these clients included overcollateralization in Bitcoin in exchange for USDT, a stablecoin tied to the US dollar, issued by Tether. The borrower is required to provide more collateral in the event that the value of bitcoin, which serves as collateral, drops below the margin call price. Tether may sell off the customer’s investment if more collateral is not delivered as per Ardoino.
The corporation seems to be implementing its policy of unprecedented risk management by accepting overcollateralization in assets such as Bitcoin. In 2022, when the price of Bitcoin took a nosedive, Celsius Network contacted the issuer of USDT and asked that they liquidate the Bitcoin held as collateral.
Moreover, in response, the stablecoin provider sold the Bitcoin and sent the remaining funds back to the lender. Therefore, according to Ardoino, the accusation of fraud is without merit. As the Bitcoin in issue was used to cover the exchange’s position during that period.
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