Celsius Sues Tether for $2.4B in Bitcoin, Tether Strikes Back, Calls Case a ‘Overturn’

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USDT stablecoin issuer Tether has hit back at Celsius Network in response to a lawsuit filed against the company on Friday. Tether called the case a “blaming” attempt to shift the blame for Celsius’ financial mismanagement onto Tether.

According to a recent blog post from Tether, in 2022, the company and Celsius signed an agreement whereby Celsius borrowed USDT from Tether, using Bitcoin (BTC) as collateral.

When the price of BTC fell, Celsius refused to provide additional collateral as stipulated in the agreement. Tether then liquidated the BTC collateral under the terms of the agreement when Celsius defaulted, the firm explained.

Celsius, through its Blockchain Recovery Investment Consortium, is now accusing Tether of improper liquidation. Celsius is demanding roughly $2.4 billion in BTC returns from Tether, but the stablecoin issuer claims the lawsuit is baseless, vowing to defend itself.

“Tether will never fall prey to shameless litigation money. We will vigorously defend ourselves against the unjustified allegations made against us and expect to prevail in this litigation,” said Tether.

In a post on X, Tether CEO Paolo Ardoino argued that Tether acted according to the contract and that the lawsuit misunderstands the basic concepts of risk management, market drifts and liquidation processes.

He said that even if the lawsuit were to progress, Tether’s strong financial position, with nearly $12 billion in equity, ensured that USDT holders would not be affected.

“When it comes to the safety of USDT users, without a doubt, our top priority and duty, Tether Group has nearly $12 billion in equity capital. Even in the most remote scenario where this baseless lawsuit goes anywhere, USDT token holders will not be affected,” Ardoino noted.

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