 So there's been a lot of fud being spread related to the tether new york attorney general lawsuit connected to this January 15th date So I did some digging or well I had to do a lot of it because there really wasn't much mention of it on any news sites since Really last summer and only youtubers have really been the ones spreading this type of information right now so Who really is right? Who's telling the truth? What is actually going on? Well Luckily for you guys we did all the work and that's what we're here to uncover in today's video Don't want to miss this Hey, what's up J here and welcome to Bitcoin daily bringing you guys the best tips tutorials and ideas to help you guys Learn how to become profitable and successful traders on this channel We typically cover news market analysis trade ideas and tutorials on how to trade to help you guys get to that next level So make sure to hit that subscribe button Make sure to like this video and share this video as we continue to empower the people through crypto currency So before we jump into the lawsuit first we need to understand what is tether So tether was the world's first stablecoin and it's currently the most popular stablecoin out there with a market cap of around 25 billion dollars it was designed to hold a one-to-one Value with the US dollar it was originally released in 2014 under the name real coin like other stable coins USDT is useful for trading crypto currencies as it allows traders to avoid market volatility That is common to BTC and other crypto assets Using stablecoins also removes the extra costs and delays of converting between crypto and fiat currencies each tether Unit issued into circulation is backed in a one-to-one ratio an example one tether USDT is One dollar simple enough, right? Wow the original one-to-one asset for tether was USD It has since morphed to including holding collateral with other real-world cash equivalents Assets and receivables from loans. So now that we've covered what tether is now What's exactly the situation that we have here with this tether and New York? New York Attorney General lawsuit so on the 9th of July 2020 the New York court approved an Investigation by the New York State's Attorney General to look into numerous businesses behind tether around November 2018 rumors of tether not being backed one-to-one reached the former State Attorney General of New York Leticia James she initiated an investigation in tether and bitfinex But the two companies filed an appeal resulting in the whole of the investigation With the approval of the New York court on the 9th of July 2020 the case finally resumed against tether and Bitfinex, so if you guys have never heard of bitfinex It is an exchange here where you can trade crypto currencies just like most other exchanges Now while I have not ever personally used or traded on bitfinex I do know of people who have used the exchange before If we pull up the coin market cap here, you guys can see that tether USDT is currently number three by size of market cap with a 24.2 billion dollar market cap if you guys want any more information on tether itself You can go to tether.to as you guys can see here and they have a whole lot of different information You can see here. They are a stable currency. You see here that they say that they're 100% backed As it says here every tether is always 100% backed by our reserves which include Traditional currency and cash equivalents and from time to time may include other assets and Receivables from loans made by tether to third parties which may include Affiliated entities every tether is also one-to-one pegged to the dollar So one USDT is always valued by tether at one USD So I stated here where is under transparency It says that the value of our reserves is published daily the value of our reserves matches or exceeds The value of all tethers in circulation So with that in mind that would mean that they have to have over 24.2 billion dollars in cash reserves to back what is currently in Circulation so after searching all over the internet and really finding no type of articles relating to this that's anything recent I ran into a reddit article here by Someone by the name of sweet pie one two three So I'm not sure exactly how reliable this is But it's what we got to work with for now. So sweet pie said what did the former state attorney general of New York find out? At this time in crypto there weren't a lot of banks willing to work with tether and Bitfinex Bitfinex therefore use a Panama based payments processor called crypto capital corp Crypto capital worked with organizations associated with financial crime money laundering and securities fraud Crypto capital worked like this It set up a shell company to get a bank account and use it until it gets shut down Bitfinex's parent company suddenly had a black hole in its finances 850 million dollars of its funds were held up at crypto capital when the money disappeared the respondents Which were tether and bitfinex allegedly hid the losses through numerous yet Unexplained tricks which led to believe tether was printing tether without it being backed by USD a lawsuit filed by the attorney general's office included chat logs about funds that crypto capital had lost The logs were between a bitfinex representative in a crypto capital representative again guys, this is from a reddit post made by a guy named sweet pie one two three So what happens on January 15th? Bitfinex and tether have to the 15th of January to submit documents to the New York State Attorney General about their financial relationship the shortfall of $850 million was allegedly printed by tether and given to bitfinex to cover up the losses Crypto capital created it is speculated bitfinex and tether can't submit any documents without revealing their cover up This will result in the conclusion that tether isn't backed one-to-one by USD by a lot of investors And will result in more investigations by the attorney general tether is Unaudited at the moment meaning no one checked the bankroll of tether if there really is 24 billion USD there So he goes on to say whether you like it or not tether is going to cause chaos in the crypto market at least in the short term in Sweet pie one two three's opinion It's obviously a cover-up by tether and bitfinex because they worked with a shadow bank to get their funds on regular banks All right, so remember guys remember guys. This is a guy called sweet pie one two three So I've been going through their Twitter And look looking around and everything has seemed like business as usual You can see here that when the whole thing with XRP happened and XRP started getting delisted Key young Jew hadn't made a tweet If SEC's next target is tether is going to be very very bad for this bull run as this market heavily relying on USDT he also went to say that USDC the most legally regulated stablecoin will eventually replace USDT so this is where I started running into some tweets by Paolo Are don't are don't know are doing you are don't know not sure how he pronounces that But he said reminder tether is registered and regulated under FinCen as all the centralized competitors strict KYC AML is applied to all tether direct users as the other main issuers are doing less Regulated is just fud ask yourself who benefits from spreading such misinformation And he put a clown face So on December 31st tether tweeted tether actively works with global regulators and law enforcement agencies furthermore tether enforces rigorous KYC and AML procedures and deploys state-of-the-art technologies to monitor transaction activities and the risk profile of token holders tether tokens USDT are fully backed by reserves and are issued pursuant to market demand That's when I came across this tweet I've got Paolo and Stewart, which is a Bitcoin lawyer CTO and general counsel for tether Coming to the podcast tomorrow to deal with the tether fud so guess what guys we were able to go ahead and listen to that entire podcast like two or three times and Clip it for you guys to share with you right now All right guys next we're about to cover the clips of audio from the interview from the podcast What Bitcoin did if you guys are enjoying this video so far? Make sure to hit that subscribe button if you're not subscribed yet Make sure to also hit that like and share this video turn on those notifications as well So you guys know as soon as our videos are up. We update Monday through Friday Five days a week every single week guys. So our tether is fully backed Look the short answer is yes Every tether is 100% backed by our reserves and those reserves include traditional currency and cash Equivalence and may include other assets and receivables from loans made by tether to third parties Now that lending Includes the loan to Bitfinex Which currently stands at a principal balance of 550 million dollars The principal having been paid down ahead of schedule The loan is on commercially reasonable terms All interest is prepaid to the end of this month, and it's otherwise in good standing Every USDT is also pegged one to one to the dollar So USDT is always valued by tether at one USDT to one USD tether has always been able to honor redemption requests and To put it simply there's never been a single instance in which tether Could not honor a redemption and our detractors can't point to one because one doesn't exist and in fact There's considerable evidence of USDT being redeemed by our customers freely So let me just ask if anyone seriously believes after we You know that we could be put under the microscope in the way that we have and still be operating if we if we weren't back All right, let's talk about the my AG case for those people who don't know because it's quite complicated How would you summarize the accusations? so Let's start with some baseline information on nyag First there is no lawsuit or complaint that's been filed against Bitfinex or tether in New York by the AG Second this is not Not a criminal investigation And third the special proceeding is only directed at Getting information and keeping the injunction in order for the AG of the AG to conduct her investigation now Bitfinex and tether have cooperated with the AG's office for over two years and have produced approximately 2.5 million pages of materials While the AG's office originally obtained an injunction relating to tether's reserves In April of 2019 that injunction was substantially narrowed In the ensuing weeks and is not disrupted the day-to-day business of either Bitfinex or tether And the injunction in the order for information is what we've been referring to online when we speak about the 354 order So the injunction set to expire by its terms on January 15th Which is the January 15th date that I I referenced earlier that people have been talking about and by that time the companies expect to have finished Producing documents to the Attorney General. So we've seen a lot of FUD and fear mongering about January 15th Much of it by those who hate not just tether, but the entire digital token ecosystem Despite those rumors and attacks Let me assure you that the business of tether and Bitfinex will remain the same after January 15th I think our discussions with the AG are going well. I think they're constructive and We look forward to to continuing that conversation with them But what is it they're pursuing here particularly? They are seeking their the original order had an injunction component And joining us from doing certain things which doesn't affect our day-to-day business at this at this time And it also sought information. So if you go through all of the requests that were in the original order from last April They set out a series of A series of things that they wanted a series of documents information they wanted from us um, we pushed back on that we Appealed the supreme court's ruling on that the new york supreme court's ruling on that we lost we accept that And we've mediated our disputes as the attorney general said In their letter to the court a few weeks ago. So Again, they're looking for that information. We are in the course of providing that that's going to be done by the 15th and And we're continuing to talk with them So what what happens after the 15th? What are the next steps in this because two years is a long time? I'm sure you want this wound up as uh quickly as possible What are the next steps after that time will tell again our discussions to them are constructive we've You know, we've we're on track to give them everything they're looking for And uh, we'll see where it goes Okay, I'm trying to understand what the various possible outcomes are from this and whether you can even talk about them um Is there a scenario where tether is wound up? Is there a scenario where tether is just fine? And is there a scenario where actually they complete their investigation and and there's no action to be taken? Certainly Certainly, they may complete their investigation and they may bring a complaint They may complete their investigation and think that there's nothing for it to be done Um, there may be some kind of settlement between the parties There are any number of things could happen All right guys, so that covered a lot of the fud that's been being spread around right now But it at the same time it kind of leaves us hanging, right? um Because at the end there he said he didn't you know, he he didn't have an answer to what the um The result of this He predicts will be what he said he's going to that they're turning in all of the paper all the all of the documents that has been requested by the ag and That now they just have to kind of sit and wait and see what the ag decides to do Or how they decide to proceed with this case I mean, but they sound very confident You know what I mean, and they're just continuing with business as usual So that brings the question like if if you have a company and um, You know that You know, that's it. You're done Um, you wouldn't would you continue to do business as usual and just be like, you know, whatever when the grenade when it explodes It explodes and that's it. We're just gonna ride it to the wheels fall off You know, would you can would you be out doing interviews and covering all this stuff? I don't know. It's very weird It's a very very weird situation guys um I'm trying to decide whether or not us DT if there was a case against it If how if or how it would affect the market Most of these cases They they usually and if there is something they usually end in some sort of settlement And that's kind of from listening to the interview is kind of Where it seemed like the the council was leaning towards um The way he was speaking and the way he kind of answered those questions it sounded like he expects some sort of Some sort of settlement at the end And as you can see, you know as far as the eight hundred and fifty million dollars They're they're They spun that as a loan That's being repaid back to them, right? So I think they said that 500 million is what's left on the loan or something like that and that they're up to date on the loan So if it was over that money Then it looks like they have that covered as a loan like you can give a loan to to somebody Um, so that's kind of it looks like that's what they're using to kind of Cya cover your ass Um, and they're it looks like they're going to cover their ass with just having that 850 million that they gave to bitfinex just saying look this was a loan You know what I mean? And if they're they've given already 2.5 million pieces of documentation to Uh the ag and they're giving them the rest of what they're asking for it seems like they they've covered their asses, right? So worst-case scenario, I'm thinking some sort of settlement where it doesn't really affect tether too much and maybe, you know Maybe the ag asked for some sort of audit. Maybe I don't know As you as you heard they want to be more transparent in 2021 with where other Funds are their investments and their different allocations of the money So, um, so it looks like they're playing ball. It looks like they're on the right path. So I can't, um I don't think it's going to it's going to be chaos as most people are currently spreading it as as this huge chaotic date on january 15, so That's my take on it guys. Um, that's my opinion just from listening and and what I've read and what I looked over guys, um Hopefully you guys enjoyed this video and you guys got a little clearer Understanding on the situation and exactly what it is that's currently going on with this and why people are constantly talking about it Um, it's currently january 12th. So we have three days until that date of january 15th Um, where they said it would be chaos, right? So guys, if you've made it to the end, I appreciate you guys Please guys make sure if you're not subscribed yet Go ahead and hit that subscribe button Hit that like so that we can continue to empower the crypto community and the people through Cryptocurrency knowledge knowledge is power guys bitcoin and crypto is freedom from the government Alrighty guys, I am out of here. I will see you guys tomorrow on the next video as always. Peace and love