Tether Settles Celsius Lawsuit for a Landmark $300 Million

In a significant development for the cryptocurrency market, Tether (USDT) has agreed to a substantial $300 million settlement with the bankrupt crypto lender Celsius. This resolution concludes a contentious adversary proceeding initiated last year, marking a crucial step towards restitution for Celsius's creditors.

The Heart of the Dispute: Allegations and Defense

The legal battle stemmed from allegations by Celsius that Tether mishandled collateral and liquidations. Celsius's claims were considerable, seeking 39,542 BTC (valued at approximately $4.3 billion at the time) along with an additional $100 million in damages, representing their largest third-party claim. In response, Tether vehemently denied these accusations, labeling the lawsuit a "shake down" and asserting that Celsius itself was responsible for providing additional collateral amidst fluctuating Bitcoin prices, thus leading to its mismanagement issues.

A Path to Recovery for Creditors

The recently announced settlement is set to provide a notable return for creditors involved in Celsius's bankruptcy proceedings. Both parties expressed satisfaction with the outcome. Paolo Ardoino, Tether's CEO, stated the company was "pleased to have reached a settlement of all issues related to the Celsius bankruptcy." Echoing this sentiment, David Proman, Managing Partner of GXD Labs (part of the Blockchain Recovery Investment Consortium, BRIC, which announced the deal), remarked on the positive resolution of Celsius's adversary proceeding against Tether and related claims.