Tether Limited has announced it will vigorously defend itself against a lawsuit filed by Celsius Network Limited through the Blockchain Recovery Investment Consortium, LLC, in the United States Bankruptcy Court for the Southern District of New York.
According to Tether, the lawsuit, initiated on August 9, 2024, is without merit and is an attempt to shift the financial burden of Celsius Network’s alleged mismanagement onto Tether. The dispute originates from a 2022 agreement in which Tether provided USD₮ to Celsius, with bitcoin (BTC) posted as collateral. When BTC prices fell in June 2022, the agreement required Celsius to post additional collateral to prevent liquidation. Instead, Celsius directed Tether to liquidate the BTC collateral to settle its $815 million position.
Tether contends that the lawsuit improperly challenges the validity of the agreement and seeks the return of approximately $2.4 billion worth of BTC, despite the liquidation being carried out at Celsius’ direction and consent. The company argues that the lawsuit misinterprets the agreement and legal principles and raises jurisdictional issues.
Tether maintains that it will respond to the lawsuit in court and rejects what it describes as an unjustified attempt to exploit the legal system. The company also reported strong financial health, with consolidated equity of nearly $12 billion as of June 30, 2024, and ongoing profitability, asserting that the claims would have no impact on Tether token holders even if they were found to be valid.
