Bitfinex

Bitfinex was founded in December 2012 as a peer-to-peer bitcoin exchange offering digital asset trading services to users worldwide. Bitfinex initially started as a P2P margin lending platform for bitcoin and later added support for more cryptocurrencies. It was one of the first professional platforms built for cryptocurrency trading.{{cite web |title=Bitfinex Trading Volume, Stats & News |website=Forbes |date=2023-04-24 |url=https://www.forbes.com/digital-assets/exchanges/bitfinex/ |access-date=2023-04-24}}

Raphael Nicolle, an IT technician from Paris, launched Bitfinex following a previous project called Bitcoinica. He continued to work as a developer for the platform until the beginning of 2017. Bitfinex was designed to offer high-volume trading and both spot and derivatives products, including exchange trading, margin trading, margin funding (P2P lending), over-the-counter markets, and derivatives trading.{{cite web |title=Best Crypto Exchanges For Australians In 2023 |website=Forbes Advisor Australia |date=2023-04-11 |url=https://www.forbes.com/advisor/au/investing/cryptocurrency/best-crypto-exchanges-for-australians-in-2023/ |access-date=2023-04-24}}

In 2015, Bitfinex partnered with Palo Alto company BitGo to offer highly-secured wallets that allow people to store their digital currencies online. BitGo has insurance against bitcoin theft.{{Cite journal|url=https://www.csmonitor.com/Business/new-economy/2016/0803/Bitcoin-security-breaches-raise-questions-about-digital-currency-s-future|title=Bitcoin security breaches raise questions about digital currency's future|journal=Christian Science Monitor|access-date=February 6, 2023|archive-date=June 12, 2018|archive-url=https://web.archive.org/web/20180612230357/https://www.csmonitor.com/Business/new-economy/2016/0803/Bitcoin-security-breaches-raise-questions-about-digital-currency-s-future|url-status=live}} In May 2015, the exchange was hacked, which resulted in the loss of 1,500 bitcoins or about $400,000 USD of their customers' assets.{{Cite news |last=Baraniuk |first=Chris |date=August 8, 2016 |title=Bitcoin users 'must pay' for lost coins |work=BBC News |url=https://www.bbc.com/news/technology-37009319 |url-status=live |access-date=November 23, 2017 |archive-url=https://web.archive.org/web/20171105132905/http://www.bbc.com/news/technology-37009319 |archive-date=November 5, 2017}}{{Cite news |last=Popper |first=Nathaniel |date=2017-11-21 |title=Warning Signs About Another Giant Bitcoin Exchange |language=en-US |work=The New York Times |url=https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |access-date=2021-10-14 |issn=0362-4331 |archive-date=November 22, 2017 |archive-url=https://web.archive.org/web/20171122214628/https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |url-status=live }} In June 2016, the U.S. Commodity Futures Trading Commission ordered Bitfinex to pay a $75,000 fine for offering illegal off-exchanged financed commodity transactions. The order also found that Bitfinex violated the Commodity Exchange Act by not registering as a Futures Commission Merchant.{{Cite web |date=June 2, 2016 |title=CFTC Orders Bitcoin Exchange Bitfinex to Pay $75,000 for Offering Illegal Off-Exchange Financed Retail Commodity Transactions and Failing to Register as a Futures Commission Merchant |url=https://www.cftc.gov/PressRoom/PressReleases/pr7380-16 |url-status=live |archive-url=https://web.archive.org/web/20180620074228/https://www.cftc.gov/PressRoom/PressReleases/pr7380-16 |archive-date=June 20, 2018 |access-date=June 4, 2018 |website=Commodity Futures Trading Commission}}

{{Main|2016 Bitfinex hack}}

In August 2016, Bitfinex announced it had suffered a major security breach.{{Cite web |date=May 21, 2017 |title=Bitfinex comes back from $69 million bitcoin heist |url=http://www.sfgate.com/business/article/Bitfinex-comes-back-from-69-million-bitcoin-heist-11161585.php |url-status=live |archive-url=https://web.archive.org/web/20170522112449/http://www.sfgate.com/business/article/Bitfinex-comes-back-from-69-million-bitcoin-heist-11161585.php |archive-date=2017-05-22 |df=mdy-all}} Immediately thereafter, bitcoin's trading price plunged by 20%.{{Cite news |last=Tsang |first=Amie |date=August 3, 2016 |title=Bitcoin Plunges After Hacking of Exchange in Hong Kong |work=The New York Times |url=https://www.nytimes.com/2016/08/04/business/dealbook/bitcoin-bitfinex-hacked.html |url-status=live |archive-url=https://web.archive.org/web/20170518201610/https://www.nytimes.com/2016/08/04/business/dealbook/bitcoin-bitfinex-hacked.html |archive-date=May 18, 2017}} After learning of the breach, Bitfinex halted all bitcoin withdrawals and trading. In that hack, the second-biggest breach of a bitcoin exchange platform, 119,756 units of bitcoin, worth about $72 million at the time, were stolen. The bitcoin was taken from users' segregated wallets and Bitfinex said it was tracking down the perpetrators of the hack.{{Cite web |title=Bitcoin Worth $72M Was Stolen in Bitfinex Exchange Hack in Hong Kong |url=http://fortune.com/2016/08/03/bitcoin-stolen-bitfinex-hack-hong-kong/ |url-status=live |archive-url=https://web.archive.org/web/20161120085013/http://fortune.com/2016/08/03/bitcoin-stolen-bitfinex-hack-hong-kong/ |archive-date=November 20, 2016 |access-date=October 26, 2016 |website=Fortune}} Exchange customers, even those whose accounts were not broken into, had their account balance reduced by 36% and received BFX tokens in proportion to their losses.{{Cite news |last=Baldwin |first=Clare |author-link=Clare Baldwin |date=August 6, 2016 |title=Bitfinex exchange customers to get 36 percent haircut, debt token |publisher=Reuters |url=https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H |url-status=live |access-date=June 20, 2018 |archive-url=https://web.archive.org/web/20190316072616/https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H |archive-date=March 16, 2019}} All users who kept their BFX tokens were reimbursed in full within eight months of the hack in April 2017.{{cite web|last=Kharif|first=Olga|title=Bitfinex Cryptocurrency Linked to 2016 Hack Surges 59% After Fund Recovery|website=Bloomberg|date=2022-02-08|url=https://www.bloomberg.com/news/articles/2022-02-08/cryptocurrency-of-hacked-exchange-surges-59-after-fund-recovery|access-date=2023-03-20}} The exchange's access to U.S. dollar payments and withdrawals was then curtailed. The hack happened even though Bitfinex was securing the funds with BitGo, which uses multiple-signature security.{{Cite news |date=2016-08-03 |title=Bitcoin worth $72 million stolen from Bitfinex exchange in Hong Kong |language=en |work=Reuters |url=https://www.reuters.com/article/us-bitfinex-hacked-hongkong-idUSKCN10E0KP |access-date=2021-10-14 |archive-date=November 11, 2020 |archive-url=https://web.archive.org/web/20201111120442/https://www.reuters.com/article/us-bitfinex-hacked-hongkong-idUSKCN10E0KP |url-status=live }}

The U.S. Department of Justice recovered the stolen bitcoin,{{cite web|last=Mozée|first=Carla|title=US stocks extend rally into second day with Fed official seeing the US at the 'cusp' of easing inflation|website=Markets Insider|date=2022-02-09|url=https://markets.businessinsider.com/news/stocks/stock-market-news-rally-continues-atlanta-fed-bostic-inflation-easing-2022-2|access-date=2023-03-20}} and a New York couple, Ilya Lichtenstein and his wife, Heather R. Morgan, was federally charged in February 2022 with conspiring to launder the bitcoin, which was then worth $3.6 billion.{{Cite news |last=Barrett |first=Devlin |date=February 8, 2022 |title=Feds arrest couple, seize $3.6 billion in hacked bitcoin funds |newspaper=The Washington Post |url=https://www.washingtonpost.com/national-security/2022/02/08/bitfinex-hack-bitcoin-arrests/ |access-date=February 8, 2022 |archive-date=February 16, 2022 |archive-url=https://web.archive.org/web/20220216064314/https://www.washingtonpost.com/national-security/2022/02/08/bitfinex-hack-bitcoin-arrests/ |url-status=live }}{{Cite news |last=Lyngaas |first=Sean |date=February 8, 2022 |title=Feds arrest a New York couple and seize $3.6 billion in stolen cryptocurrency |page=1 |work=CNN News |url=https://edition.cnn.com/2022/02/08/investing/cryptocurrency-laundering/index.html |access-date=February 9, 2022 |archive-date=February 14, 2022 |archive-url=https://web.archive.org/web/20220214173633/https://edition.cnn.com/2022/02/08/investing/cryptocurrency-laundering/index.html |url-status=live }} According to Justice officials, Lichtenstein and Morgan are charged with conspiracy to launder money and conspiracy to defraud the United States. On February 10, 2022, it was reported that Morgan was detained in Manhattan on February 8, 2022, with her husband.{{Cite news|last=Farrer|first=Martin|date=February 10, 2022|title='Sexy horror comedy': Bitcoin laundering suspect is also 'raunchy rapper' Razzlekhan|pages=1|work=The Guardian News|url=https://www.theguardian.com/technology/2022/feb/10/sexy-horror-comedy-bitcoin-laundering-suspect-is-also-raunchy-rapper-razzlekhan|access-date=February 10, 2022}} According to court records, Lichtenstein and Morgan appeared for a plea hearing on August 3, 2023, in Washington, D.C.{{Cite web|url=https://www.reuters.com/world/us/us-couple-accused-laundering-crypto-bitfinex-hack-reach-plea-deal-2023-07-21/|title=Crypto rapper 'Razzlekhan,' husband reach plea deal over Bitfinex hack laundering|first1=Luc|last1=Cohen|date=July 21, 2023|via=www.reuters.com}}{{Cite web|url=https://www.nytimes.com/2023/07/21/nyregion/bitfinex-heist-laundering-plea-deal.html|title=2 Charged in Plot to Launder Billions in Cryptocurrency Reach Plea Deal|first=Ed|last=Shanahan|date=July 21, 2023|via=NYTimes.com}} They were charged in the case with a document known as an information, which is a type of charging document that federal prosecutors typically use when defendants have agreed to plead guilty.{{Cite web|url=https://www.cnbc.com/2023/07/21/crypto-couple-appear-set-to-plead-guilty-in-bitcoin-money-laundering.html|title='Crypto Couple' appear set to plead guilty in bitcoin hack money laundering case|first=Dan Mangan, Jim|last=Forkin|date=July 21, 2023|website=CNBC}}

Since Lichtenstein and Morgan's arrests, the government seized another $475 million tied to the attack. In August 2023, Lichtenstein pleaded guilty to a conspiracy to launder stolen cryptocurrency in Washington, D.C. Morgan also pleaded guilty to two charges, money laundering conspiracy and conspiracy to defraud the U.S. government. The value of the stolen bitcoin ended up being worth $4.5 billion.{{cite web|last=Dan Mangan|first=Eamon Javers|title=Bitcoin launderer pleads guilty, admits to massive Bitfinex hack|website=CNBC|date=2023-08-03|url=https://www.cnbc.com/2023/08/03/new-york-man-admits-being-original-bitfinex-hacker-during-guilty-plea-in-dc-to-bitcoin-money-laundering.html|access-date=2023-09-26|archive-date=September 26, 2023|archive-url=https://web.archive.org/web/20230926230034/https://www.cnbc.com/2023/08/03/new-york-man-admits-being-original-bitfinex-hacker-during-guilty-plea-in-dc-to-bitcoin-money-laundering.html|url-status=live}}{{cite web|last=Cohen|first=Luc|title=Buried gold, burning trash: US couple admits to hiding hacked crypto|website=Reuters|date=2023-08-03|url=https://www.reuters.com/world/us/us-man-pleads-guilty-laundering-crypto-stolen-bitfinex-hack-2023-08-03/|access-date=2023-09-26}}{{cite web|last=Willmer|first=Sabrina|title=Bitfinex Hacker, Rapper Wife Plead Guilty in Crypto Heist Money Laundering|website=Bloomberg.com|date=2023-08-03|url=https://www.bloomberg.com/news/articles/2023-08-03/wall-street-rapper-s-husband-pleads-guilty-in-crypto-heist-tied-to-bitfinex-hack|access-date=2023-09-26}} Lichtenstein also admitted to being the original hacker of bitcoin in the 2016 cyberattack on Bitfinex. In November 2024, Lichtenstein was sentenced to five years in a U.S. prison for his involvement in money laundering the stolen bitcoin.{{cite web|last=Hoskins|first=Peter|title=US hacker sentenced over Bitcoin heist worth billions|website=BBC Home|date=2024-11-15|url=https://www.bbc.com/news/articles/c2dl70wed1lo|access-date=2025-01-30}} Morgan was sentenced to 18 months in prison for fraud and conspiracy charges.{{cite web|last=Davis|first=Wes|title=Razzlekhan, crypto's most embarrassing rapper, is going to prison|website=The Verge|date=2024-11-18|url=https://www.theverge.com/2024/11/18/24299934/razzlekhan-crypto-bitfinex-hack-heather-morgan|access-date=2025-01-30}}

Referring to the 2016 hack, IRS Commissioner Charles Rettig said, "This was also the largest single financial seizure recorded by the federal government."{{Cite web |url=https://www.irs.gov/newsroom/irs-statement-irs-commissioner-charles-rettigs-final-message |title=IRS Statement — IRS Commissioner Charles Rettig's final message |work=Internal Revenue Service |access-date=February 6, 2023}} Separately, Bitfinex worked with the U.S. Department of Homeland Security to recover about $315,000 in cash and cryptocurrencies stolen in the 2016 breach. The funds would be redistributed to holders of Bitfinex's Recovery Right Tokens, digital coins issued to people who suffered financial losses due to the hack.{{Cite web|url=https://www.bloomberg.com/news/articles/2023-07-06/crypto-exchange-bitfinex-says-315-000-from-2016-hack-recovered|title=Crypto Exchange Bitfinex Says $315,000 From 2016 Hack Recovered|date=July 6, 2023|via=www.bloomberg.com}} There was concern their customers' money had been lost in several incidents; the missing funds were not lost but seized and safeguarded. During this same period, Bitfinex found that obtaining banking services was more and more difficult.{{Cite news |last=Kaminska |first=Izabella |date=April 26, 2019 |title=We all become MF Global eventually, Tether edition |work=Financial Times |url=https://ftalphaville.ft.com/2019/04/26/1556291388000/We-all-become-MF-Global-eventually--Tether-edition/ |url-status=live |access-date=May 20, 2019 |archive-url=https://web.archive.org/web/20190427164904/https://ftalphaville.ft.com/2019/04/26/1556291388000/We-all-become-MF-Global-eventually--Tether-edition/ |archive-date=April 27, 2019}}{{Cite news |last=Lee |first=Timothy B. |date=April 29, 2019 |title=The leading "stablecoin" is no longer backed by $1 for every coin |work=Ars Technica |url=https://arstechnica.com/tech-policy/2019/04/how-a-major-cryptocurrency-exchange-lost-control-of-851-million/ |url-status=live |access-date=May 20, 2019 |archive-url=https://web.archive.org/web/20190510181358/https://arstechnica.com/tech-policy/2019/04/how-a-major-cryptocurrency-exchange-lost-control-of-851-million/ |archive-date=May 10, 2019}}{{Cite news |last=Vigna |first=Paul |date=May 17, 2019 |title=Lack of Banking Options a Big Problem for Crypto Businesses |publisher=Wall Street Journal |url=https://www.wsj.com/articles/lack-of-banking-options-a-big-problem-for-crypto-businesses-11558092600 |url-status=live |access-date=May 20, 2019 |archive-url=https://web.archive.org/web/20190521023106/https://www.wsj.com/articles/lack-of-banking-options-a-big-problem-for-crypto-businesses-11558092600 |archive-date=May 21, 2019}} Research suggests that price manipulation of bitcoin on Bitfinex accounted for about half of bitcoin's price increase in late 2017.{{Cite news |last=Popper |first=Nathaniel |date=June 13, 2018 |title=Bitcoin's Price Was Artificially Inflated Last Year, Researchers Say |work=New York Times |url=https://www.nytimes.com/2018/06/13/technology/bitcoin-price-manipulation.html |url-status=live |access-date=June 13, 2018 |archive-url=https://web.archive.org/web/20180613100732/https://www.nytimes.com/2018/06/13/technology/bitcoin-price-manipulation.html |archive-date=June 13, 2018}} iFinex issued the cryptocurrency Unus Sed Leo in 2019. Once the United States announced that most of the stolen funds were recovered, Leo's value surged more than 50%. Bitfinex promised to repurchase and burn outstanding LEO tokens within 18 months of the funds’ recovery.{{cite web |last=Kharif |first=Olga |title=Bitfinex Cryptocurrency Linked to 2016 Hack Surges 59% After Fund Recovery |website=Bloomberg.com |date=2022-02-08 |url=https://www.bloomberg.com/news/articles/2022-02-08/cryptocurrency-of-hacked-exchange-surges-59-after-fund-recovery |access-date=2023-04-24}}

In April 2017, Bitfinex announced it was experiencing delays in processing USD withdrawals after Wells Fargo cut off its wire transfers.{{Cite news |date=November 21, 2017 |title=Tether Theft Isn't the First Controversy for Cryptocurrency Firm |work=Bloomberg.com |url=https://www.bloomberg.com/news/articles/2017-11-21/tether-theft-isn-t-the-first-controversy-for-cryptocurrency-firm |url-status=live |access-date=November 23, 2017 |archive-url=https://web.archive.org/web/20171122132713/https://www.bloomberg.com/news/articles/2017-11-21/tether-theft-isn-t-the-first-controversy-for-cryptocurrency-firm |archive-date=November 22, 2017}} Shortly after the Wells Fargo cutoff, Bitfinex stated all international wires had been cut off by its Taiwanese bank. Since then, Bitfinex has moved between a series of banks in other countries without disclosing to customers where the money is kept.{{Cite news |last=Popper |first=Nathaniel |date=November 21, 2017 |title=Warning Signs About Another Giant Bitcoin Exchange |work=The New York Times |url=https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |url-status=live |access-date=November 23, 2017 |archive-url=https://web.archive.org/web/20171122214628/https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |archive-date=November 22, 2017}}{{Cite news |last=Nathaniel |first=Popper |date=November 21, 2017 |title=Warning Signs About Another Giant Bitcoin Exchange |work=New York Times |url=https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |url-status=live |access-date=June 4, 2018 |archive-url=https://web.archive.org/web/20171122214628/https://www.nytimes.com/2017/11/21/technology/bitcoin-bitfinex-tether.html |archive-date=November 22, 2017}} Noble Bank International of San Juan, Puerto Rico, reportedly handled some dollar banking for the exchange in 2017 or 2018.{{Cite news |last=Katz |first=Lilly |date=May 31, 2018 |title=Bittrex Gets Bank Agreement to Help You Buy Bitcoin With Dollars |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2018-05-31/bittrex-gets-bank-agreement-to-help-you-buy-bitcoin-with-dollars |url-status=live |access-date=June 4, 2018 |archive-url=https://web.archive.org/web/20180531142507/https://www.bloomberg.com/news/articles/2018-05-31/bittrex-gets-bank-agreement-to-help-you-buy-bitcoin-with-dollars |archive-date=May 31, 2018}} The banking relationship was reportedly terminated in September 2018 as Noble Bank encountered financial difficulties.{{Cite news |last1=Leising |first1=Matthew |last2=Rivera |first2=Yalixa |date=October 1, 2018 |title=Puerto Rico's Noble Bank Seeks Sale Amid Crypto Slide |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2018-10-02/puerto-rico-s-cryptocurrency-bank-noble-is-said-to-seek-sale |url-status=live |access-date=October 18, 2018 |archive-url=https://web.archive.org/web/20181003101255/https://www.bloomberg.com/news/articles/2018-10-02/puerto-rico-s-cryptocurrency-bank-noble-is-said-to-seek-sale |archive-date=October 3, 2018}}

In March 2018, British Virgin Islands-based Bitfinex confirmed the exchange’s plans to relocate its primary server infrastructure to Zug, Switzerland. In May 2018, Bitfinex emailed some of its users asking for some tax details, which the company indicated it would share with the government of the British Virgin Islands, which might in turn pass it on to the governments of the users' countries of residence.{{citation needed|date=May 2019}} Phil Potter, Chief Strategy Officer of Bitfinex, left the exchange on June 22, 2018.{{Cite news |last=Irrera |first=Anna |date=June 22, 2018 |title=Bitfinex chief strategy officer departs |publisher=Reuters |url=https://www.reuters.com/article/us-cryptocurrencies-bitfinex/bitfinex-chief-strategy-officer-departs-idUSKBN1JI2IN |url-status=live |access-date=June 23, 2018 |archive-url=https://web.archive.org/web/20180624013852/https://www.reuters.com/article/us-cryptocurrencies-bitfinex/bitfinex-chief-strategy-officer-departs-idUSKBN1JI2IN |archive-date=June 24, 2018}} On October 15, 2018, Bitfinex said that a few days earlier it temporarily paused fiat deposits for certain customers amid processing complications. On October 7, the company also said that "Bitfinex is not insolvent."{{Cite news |last1=Kharif |first1=Olga |last2=Leising |first2=Matthew |date=October 17, 2018 |title=Bitcoin Trades at $300 Premium on Controversial Crypto Exchange |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2018-10-17/bitcoin-trades-at-300-premium-on-controversial-crypto-exchange |url-status=live |access-date=October 18, 2018 |archive-url=https://web.archive.org/web/20181018082631/https://www.bloomberg.com/news/articles/2018-10-17/bitcoin-trades-at-300-premium-on-controversial-crypto-exchange |archive-date=October 18, 2018}}

Tether is a stablecoin pegged to the USD. It is owned by iFinex, which also owns Bitfinex. It was launched as RealCoin in July 2014 and was rebranded as Tether in November 2014. As of January 2023, Tether was the third-largest cryptocurrency after bitcoin and Ethereum with a market cap of $68 billion.{{cite web |last=Frankenfield |first=Jake |title=Tether (USDT): Meaning and Uses for Tethering Crypto Explained |website=Investopedia |date=2018-05-04 |url=https://www.investopedia.com/terms/t/tether-usdt.asp |access-date=2023-04-24 |archive-date=February 27, 2022 |archive-url=https://web.archive.org/web/20220227220814/https://www.investopedia.com/terms/t/tether-usdt.asp |url-status=live }} Tether and Bitfinex funded the development of HolePunch, an encrypted, peer-to-peer communication platform and made its code open source in December 2022. Paolo Ardoino, the chief technology officer of Bitfinex and Tether, said that this technology is the "Bitcoin of communications".

In April 2019, New York Attorney General Letitia James launched an investigation accusing Bitfinex of using the reserves of Tether, an affiliated company, to cover up a loss of $850 million to a Panamanian payment processor known as Crypto Capital Corp.{{Cite web |title=In the Matter of the Inquiry by LETITIA JAMES. : Attorney General of the State of New York. |url=https://iapps.courts.state.ny.us/fbem/DocumentDisplayServlet?documentId=vIexA1b0spKOnK_PLUS_ZUGTJ3A==&system=prod |url-status=live |archive-url=https://web.archive.org/web/20190501161959/https://iapps.courts.state.ny.us/fbem/DocumentDisplayServlet?documentId=vIexA1b0spKOnK_PLUS_ZUGTJ3A==&system=prod |archive-date=May 1, 2019 |access-date=May 22, 2019 |publisher=Supreme Court of the State of New York County of New York}}{{Cite news |last1=Larson |first1=Erik |last2=Leising |first2=Matthew |last3=Kharif |first3=Olga |date=April 26, 2019 |title=Crypto Market Roiled by New Allegations Against Tether, Bitfinex |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2019-04-25/bitfinex-operator-accused-by-new-york-of-850-million-coverup?srnd=cryptocurrencies |url-status=live |access-date=May 5, 2019 |archive-url=https://web.archive.org/web/20201014225940/https://www.bloomberg.com/news/articles/2019-04-25/bitfinex-operator-accused-by-new-york-of-850-million-coverup?srnd=cryptocurrencies |archive-date=October 14, 2020}} Reggie Fowler, who is alleged to have connections with Crypto Capital, was indicted on 30 April 2019, for running an unlicensed money-transmitting business for cryptocurrency traders.{{Cite news |last1=Robinson |first1=Matt |last2=Kharif |first2=Olga |last3=Leising |first3=Matthew |date=May 3, 2019 |title=Ex-NFL Owner Said to Be Tied to $850 Million Crypto Mystery |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2019-05-03/ex-nfl-owner-is-said-to-have-ties-to-850-million-crypto-mystery |url-status=live |access-date=May 5, 2019 |archive-url=https://web.archive.org/web/20190505190141/https://www.bloomberg.com/news/articles/2019-05-03/ex-nfl-owner-is-said-to-have-ties-to-850-million-crypto-mystery |archive-date=May 5, 2019}} He is believed to have failed to return about $850 million to an unnamed client. Investigators also seized $14,000 in counterfeit currency from his office. Bitfinex had been unable to obtain a normal banking relationship, according to the lawsuit, so it deposited over $1 billion with a Panamanian payment processor known as Crypto Capital Corp. No contract was ever signed with Crypto Capital. James alleged that in 2018 Bitfinex knew or suspected that Crypto Capital had absconded with the money, but that their investors were never informed of the loss.

Bitfinex's reported figures for 2017 were $333.5 million in gross profits, $6.8 million in expenses, $326 million in net profit, and $246 million in dividends.{{Cite news |last=Kharif |first=Olga |date=May 9, 2019 |title=Beleaguered Bitfinex Says Its Crypto Exchange Turns 97% Profit |publisher=Bloomberg |url=https://www.bloomberg.com/news/articles/2019-05-09/beleaguered-bitfinex-says-its-crypto-exchange-turns-97-profit |url-status=live |access-date=May 11, 2019 |archive-url=https://web.archive.org/web/20190511034033/https://www.bloomberg.com/news/articles/2019-05-09/beleaguered-bitfinex-says-its-crypto-exchange-turns-97-profit |archive-date=May 11, 2019}}

On October 15, 2021, it was announced that Bitfinex would pay a $1.5 million fine to the Commodity Futures Trading Commission for illegal, off-exchange retail commodity transactions in digital assets with Americans.{{Cite web |last=Lyons |first=Kim |date=2021-10-15 |title=Tether will pay $41 million over "misleading" claims it was fully backed by US dollars |url=https://www.theverge.com/2021/10/15/22728253/tether-41-million-misleading-statements-fiat-currency-bitfinex-cftc |access-date=2021-10-22 |website=The Verge |language=en |archive-date=December 6, 2021 |archive-url=https://web.archive.org/web/20211206235850/https://www.theverge.com/2021/10/15/22728253/tether-41-million-misleading-statements-fiat-currency-bitfinex-cftc |url-status=live }} Bitfinex launched a new payment technology that would allow online merchants to receive contactless and borderless cryptocurrency payments in 2021, called Bitfinex Pay.{{cite web|last=Spadafora|first=Anthony|title=Bitfinex launches system for contactless crypto payments|website=TechRadar|date=2021-03-04|url=https://www.techradar.com/news/bitfinex-launches-system-for-contactless-crypto-payments|access-date=2023-03-20|archive-date=March 20, 2023|archive-url=https://web.archive.org/web/20230320140511/https://www.techradar.com/news/bitfinex-launches-system-for-contactless-crypto-payments|url-status=live}} Bitfinex, Kraken, and Kucoin began exploring ways to enter the Indian cryptocurrency market in 2021.{{cite web|last=Mehta|first=Ivan|title=Kraken and Bitfinex are reportedly exploring ways to enter India|website=TNW|date=2021-06-09|url=https://thenextweb.com/news/kraken-bitfinex-kucoin-india-crypto-report|access-date=2023-03-20}} In September 2022, Bitfinex, alongside several other leading exchanges, temporarily paused all deposits and withdrawals of Ethereum-based tokens during the Ethereum software upgrade known as the Merge.{{cite web|last=Kharif|first=Olga|title=Crypto Firms Prepare to Pause Activity During Ethereum 'Merge'|website=Bloomberg|date=2022-09-14|url=https://www.bloomberg.com/news/articles/2022-09-14/crypto-firms-prepare-to-pause-activity-during-ethereum-merge|access-date=2023-03-20}} In December 2022, Bitfinex released its "Freedom Manifesto", a document that highlights the advancement of distributed, open-source software that aligns with the libertarian ideas of Austrian School economists and cypherpunks' approach to writing code.{{cite web |title=Open-source wants to eat the internet |website=POLITICO |date=2023-05-22 |url=https://www.politico.com/newsletters/digital-future-daily/2023/05/22/open-source-wants-to-eat-the-internet-00098229 |access-date=2023-06-05}}{{cite web |last=Engler |first=s |title=Bitfinex Invests in Chilean Crypto Exchange OrionX to Expand Presence in Latin America - Currency News - Financial and Business News |website=markets.businessinsider.com |date=2023-05-24 |url=https://markets.businessinsider.com/news/currencies/bitfinex-invests-in-chilean-crypto-exchange-orionx-to-expand-presence-in-latin-america-1032349067 |access-date=2023-06-05}}

As of January 2023, Bitfinex plans to open an office in El Salvador. El Salvador plans to issue its "volcano" token this year, which will be issued using blockchain technology, and which will trade on Bitfinex's exchange.{{Cite web |url=https://www.bloomberg.com/news/articles/2023-01-27/bitfinex-expects-el-salvador-volcano-token-issuance-this-year |title=Bitfinex Expects El Salvador Volcano Token Issuance This Year |date=January 27, 2023 |work=Bloomberg |access-date=February 6, 2023 |archive-date=January 29, 2023 |archive-url=https://web.archive.org/web/20230129201549/https://www.bloomberg.com/news/articles/2023-01-27/bitfinex-expects-el-salvador-volcano-token-issuance-this-year |url-status=live}} In April 2023, Bitfinex was granted a license by El Salvador’s National Digital Asset Commission to operate in the country. This was the first license for digital service providers in El Salvador.{{Cite web|url=https://finance.yahoo.com/news/bitfinex-invests-chilean-crypto-exchange-145427386.html|title=Bitfinex Invests in Chilean Crypto Exchange OrionX to Expand Presence in Latin America|date=May 24, 2023|website=Yahoo Finance}} The license permits Bitfinex Securities El Salvador to facilitate tokenized assets.{{cite web |last=McDonald |first=Michael |title=Crypto Exchange Bitfinex Gets License to Operate in El Salvador |website=Bloomberg Industry Group News |date=2023-04-11 |url=https://news.bloombergtax.com/crypto/crypto-exchange-bitfinex-gets-license-to-operate-in-el-salvador |access-date=2023-04-24}}{{cite web |last=Oladipupo |first=Solomon |title=Bitfinex Becomes First Licensed DASP in El Salvador |website=Finance Magnates |date=2023-04-11 |url=https://www.financemagnates.com/cryptocurrency/bitfinex-becomes-first-licensed-dasp-in-el-salvador/ |access-date=2023-04-24}} On May 24, 2023, Bitfinex announced it would invest in the Chilean cryptocurrency exchange Orionx. Bitfinex stated that it aims to expand its presence in Chile and Latin America.{{cite web |last=Castro |first=Maolis |title=Bitfinex, de los dueños de Tether, invierte en el exchange cripto chileno Orionx |website=Bloomberg Línea |date=2023-05-24 |url=https://www.bloomberglinea.com/latinoamerica/chile/bitfinex-de-los-duenos-de-tether-invierte-en-el-exchange-cripto-chileno-orionx/ |language=es |access-date=2023-06-05 |archive-date=June 5, 2023 |archive-url=https://web.archive.org/web/20230605173733/https://www.bloomberglinea.com/latinoamerica/chile/bitfinex-de-los-duenos-de-tether-invierte-en-el-exchange-cripto-chileno-orionx/ |url-status=live }} Bitfinex launched its peer-to-peer trading platform in Venezuela, Argentina, and Colombia in June 2023. The platform, Bitfinex P2P, gives people in these countries the ability to directly buy and sell popular cryptocurrencies like bitcoin, Tether's EURT stablecoin, Tether Gold, and Ethereum.{{Cite web|url=https://www.forbesindia.com/article/cryptocurrency/bitfinex-introduces-p2p-trading-platform-in-venezuela-argentina-and-colombia/86201/1|title=Bitfinex Introduces P2P Trading Platform In Venezuela, Argentina, And Colombia|website=Forbes India|access-date=2023-07-26|archive-date=July 26, 2023|archive-url=https://web.archive.org/web/20230726200209/https://www.forbesindia.com/article/cryptocurrency/bitfinex-introduces-p2p-trading-platform-in-venezuela-argentina-and-colombia/86201/1|url-status=live}}

{{Main|Tether (cryptocurrency)}}

Tether is a stablecoin that Tether Limited had claimed to be pegged to the UDS. Tether is closely associated with Bitfinex; as of 2018, they shared common shareholders and management. In 2017, critics raised questions about the relationship between Bitfinex and Tether.{{Cite news |date=November 21, 2017 |title=Crypto-currency company reports $31m raid |work=BBC News |url=https://www.bbc.com/news/technology-42065724 |url-status=live |access-date=November 23, 2017 |archive-url=https://web.archive.org/web/20171122074511/http://www.bbc.com/news/technology-42065724 |archive-date=November 22, 2017}} In February 2021, Bitfinex agreed to pay $18.5 million in a settlement with the New York Attorney General's office regarding allegations over Bitfinex parent iFinex making false statements about the backing of Tether and the movement of hundreds of millions USD between the two companies to cover up massive losses by Bitfinex in 2017 and 2018.{{Cite web |last=Browne |first=Ryan |date=2021-02-23 |title=Cryptocurrency firms Tether and Bitfinex agree to pay $18.5 million fine to end New York probe |url=https://www.cnbc.com/2021/02/23/tether-bitfinex-reach-settlement-with-new-york-attorney-general.html |access-date=2021-12-22 |website=CNBC |language=en |archive-date=December 22, 2021 |archive-url=https://web.archive.org/web/20211222100052/https://www.cnbc.com/2021/02/23/tether-bitfinex-reach-settlement-with-new-york-attorney-general.html |url-status=live }} As part of the agreement, Bitfinex would maintain its prohibition on trading activity with New Yorkers.[https://www.bloomberg.com/news/articles/2021-02-23/crypto-exchange-bitfinex-settles-with-new-york-to-end-probe "Bitfinex Settles New York Probe Into Tether, Hiding Losses,"] {{Webarchive|url=https://web.archive.org/web/20210414034335/https://www.bloomberg.com/news/articles/2021-02-23/crypto-exchange-bitfinex-settles-with-new-york-to-end-probe |date=April 14, 2021 }} Bloomberg, February 23, 2021. Also in 2021, Bitfinex repaid their remaining loan balance to Tether in full.{{Cite web |date=2021-02-05 |title=Bitfinex Says It Repaid Tether for $550M Loan at Center of NYAG Probe |url=https://www.nasdaq.com/articles/bitfinex-says-it-repaid-tether-for-%24550m-loan-at-center-of-nyag-probe-2021-02-05 |url-status=live |archive-url=https://web.archive.org/web/20210206103749/https://www.nasdaq.com/articles/bitfinex-says-it-repaid-tether-for-%24550m-loan-at-center-of-nyag-probe-2021-02-05 |archive-date=February 6, 2021 |website=nasdaq.com}} On August 4, 2023, the class action lawsuit against Tether and Bitfinex was dismissed by Chief Judge Laura Taylor Swain of the U.S. District Court for the Southern District of New York. The court found that the plaintiff lacked "plausible allegations of injury" because there was no evidence showing "USDT had a diminished actual value".{{cite web|last=Osorio|first=Nica|title=Bitfinex, Tether Win Big In US Court After Judge Dismisses Class Action Lawsuit|website=International Business Times|date=2023-08-07|url=https://www.ibtimes.com/bitfinex-tether-win-big-us-court-after-judge-dismisses-class-action-lawsuit-3707789|access-date=2023-09-26}}

• Cryptocurrency bubble

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• {{Official website|https://www.bitfinex.com}}

{{Cryptocurrency exchanges}}

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