US Court to Hear Main Case of Celsius vs. Tether 1 Trillion Won BTC Liquidation Lawsuit

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The New York Bankruptcy Court has allowed a main hearing on a multi-billion-won lawsuit against the cryptocurrency lending platform Celsius involving Tether. Accordingly, Tether's request to dismiss the lawsuit was partially accepted, and the key issues raised by Celsius will be addressed in court.

According to the filed complaint, Celsius claims that during the collapse of its platform in June 2022, Tether arbitrarily disposed of 39,500 Bitcoins (BTC) in a manner close to a 'fire sale'. The collateral value of these Bitcoins amounts to $812 million (approximately 1.1287 trillion won), and Celsius argues that Tether recovered and offset them in violation of established procedures.

In particular, Celsius pointed out that Tether's collateral liquidation violated the loan contract between the two parties and disregarded the principle of 'good faith and fair dealing' under British Virgin Islands law. Additionally, it added that under US bankruptcy law, the transaction could be invalidated as a 'fraudulent transfer' or 'preferential transfer'.

The lawsuit's issue stemmed from the margin call sent by Tether during the Bitcoin price drop. Celsius claims that Tether sold the collateral without the promised 10-hour grace period, and the average liquidation price was $20,656 per coin, much lower than the market price. Celsius stated that the sold Bitcoins were subsequently transferred to Tether's affiliated exchange Bitfinex account.

This lawsuit is drawing attention as a symbolic case that disputes the contractual relationships and collateral liquidation procedures among major companies in the cryptocurrency market. As Tether, a major stablecoin issuer, will have its actions during the Celsius incident legally reviewed, it is likely to become an important precedent for similar disputes in the future.

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#Celsius#Tether#Bitcoin#CryptocurrencyLawsuit#CollateralLiquidation

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Disclaimer: The content above is only the author's opinion which does not represent any position of Followin, and is not intended as, and shall not be understood or construed as, investment advice from Followin.
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