Celsius will be able to sue Tether for USD $ 4 billion after judicial ruling

The court that considers the case ruled that Celsius You will be able to move forward with your millionaire demand against Tether.

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• The judge rejected the defense of Tether and allowed almost all the positions of the case to advance.
  
• Tether He had liquidated BTC of Celsius for more than USD $ 4,000 million in 2022.
  
• Celsius He defends that, having accessed these funds, it was likely that he could avoid bankruptcy.
• The court will have the last word in this case.

A New York bankruptcy court has authorized Celsius to continue with its demand for more than USD $ 4,000 million against the stablecoin station USDT, Tether.

In accordance with a court order published this week, Tether failed to prove the allegations to discard the demand filed by Celsius, So the process will continue its respective course before the court in question.

The demand for Celsius against Tether

The demand, initiated in 2023 by the crypto platform now in bankruptcy, accuses Tether having improperly liquidated almost 40,000 BTC In June 2022, when the market was close to one of its lowest points and Celsius He had already paused the withdrawals of his users.

Celsius He collapsed in the middle of the chaos of the crypto market in 2022, freezing retreats on June 12 of that year and declaring bankruptcy a month later. In the middle of that collapse, Tether He executed the liquidation of 40,000 BTC that he had received as a collateral from the companya.

The lawyers of Celsius They argue that the company He had a contractual right to receive a 10 -hour window to meet the demands of collateral, something that would not have been granted. They argue that Celsius still had a lot of BTC in his balance and could have avoided bankruptcy if he had allowed him to fulfill his commitments.

According to legal documents: “If Celsius had had the opportunity to respond to the requirement of collateral – as stipulated in the contract – he could have avoided the sale of his bitcoin at a low point of the market. ”

The defense of Tether and judicial rejection

Tether, For its part, it has described demand as a “Blearly attempt to obtain money through litigation” and an “case without foundation”. In his defense, the company said it was Celsius who authorized the liquidation of BTC to cover a position of approximately 815 million USDT

Besides, Tether argued that Alex Mashinsky – then CEO of Celsius- would have given a verbal authorization to execute the liquidation. However, The judge dismissed that argument, indicating that said authorization “It is not enough “ to invalidate the contractual requirement to grant a deadline to respond.

“The alleged oral authorization does not replace the terms of the written contract,” The judge concluded.

What charges are still standing and what implications does the failure have

The judge’s ruling allows Celsius Continue with most of the positions of the case, including the claim for breach of contract. Only one position was dismissed: the one who claimed that Tether violated the “Pact of good faith and fair treatment” under the law of the British Virgin Islands.

That position was discarded without prejudice, which means that Celsius It could present it again if it manages to better support the facts according to said legislation.

This legal setback is significant for Tether, since it mine the solidity of its contractual defense. It could also have implications for other similar litigation related to practices during the 2022 crisis.

With the clear track, Celsius may move towards the next stage of the trial, where the facts will be examined and will be determined whether the liquidation made by Tether It was indeed a contractual violation.

Tether He has promised to continue defending his position. The company has not yet issued a new statement after the judge’s order.

Article written by a content editor. Edited by Angel Di Matteo / Diariobitcoin

Original image of Diariobitcoin, created with artificial intelligence, for free use, licensed under public domain

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