The Supreme Court of the New York State has rejected a petition filed by Tether which allowed the public to be barred from receiving documents that lay out the composition of Tether’s reserves over the past few years.
The documents of denial by the court were posted by CryptoWhale on Twitter, a day ago.
Tether paid $18.5 million to the New York Attorney General’s Office (NYAG) a year ago, for its role in Bitfinex’s effort to cover up $850 million in finances of its payments processor, Crypto Capital Corp. Bitfinex is a crypto exchange platform owned by Tether.
In a press statement, New York Attorney General Letitia James accused Bitfinex and Tether of “negligently and unlawfully covering up massive financial losses in order to continue their plan and protect their bottom lines.”
Bitfinex and Tether were then asked to submit quarterly asset disclosures. Following this, CoinDesk asked Tether for its reserves composition under the FOIL.
Tether retaliated by filing a lawsuit against the NYAG saying that disclosing the financial details of the company would put it at a competitive disadvantage.
Tether has said,“The settlement specified what information should be publicly disclosed (such as the breakdown of Tether reserves by category) and what should be disclosed privately (such as specific investment details) to the NYAG. The private aspects are those which no business shall publish for the sake of competition of exploitation.”
In August 2021, Tether and parent company IFinex filed a petition in the New York State Supreme Court to prevent the state attorney general’s office from supplying records showing their reserves to CoinDesk.
In February 2022, Tether and iFinex, entered a case against both CoinDesk and NYAG.
Tether’s lawyers said, “The records issued herein include closely guarded, non-public internal records of Bitfinex and Tether that were developed at considerable expense and could not have been acquired by its competitors except through this FOIL request.”
The limelight on stablecoins is unlikely to go away anytime soon, seeing how the recent crash of Terra’s stablecoin LUNA wiped away millions of dollars from the market. The current market cap of Tether is $74 billion.