Are Tether and BitFinex, the entities behind the issuance of the crypto market’s main stablecoin USDT, giants with feet of clay? Giants whose profile, reputation and past actions of their historical founders would constitute the greatest fragility, threatening even their foundation and, by extension, the entire crypto-currency industry? Without formally answering this question, it is in any case the thread perceived in the very thorough investigative work done by the Italian journalist Nicola A. BORZI of which we take back today the good sheets.
THE CENTRAL IMPORTANCE OF TETHER (USDT) FOR THE CRYPTO INDUSTRY
Even if you are a great beginner of the crypto subject, it will not have escaped your attention how important stablecoins are and how ubiquitous the most important of them is: the USDT.
The USDT stablecoin was created in 2014 and represents, at the time of writing, a money supply of $66 billion.
If the figure is impressive, we will remember above all that in accordance with the principle that 1 USDT = $1, the equivalent of 66 billion in value is supposed to be held at this very moment in the coffers of Tether, the entity in charge of its management.
Bitfinex is for its part a crypto exchange platform, intrinsically linked to Tether. A close co-relation that had the gift of annoying the Attorney General of the state of New York worried about the business relations between the entities. A concern that will finally be dispelled in February 2021 with a handshake and a big check.
Beyond these courtroom twists and turns, there remains a fundamental issue concerning the solidity of the USDT/Tether/Bitfinex triptych. This solidity is indeed entirely based on the belief in the reality of the said reserves, and represents a sea serpent in the crypto industry for years.
While things have been getting clearer lately, with Tether increasingly lending itself to generally positive external audits, a muted anxiety remains: the collapse or wobbling of the USDT (in other words, the unraveling of its parity with the dollar) would be an event that would make LUNA, Celsius and even FTX storms look like pleasant spring rains.
Finally, let’s end this quick overview by pointing out that the Italian Giancarlo Devasini is the CFO of Tether and Bitfinex and the Dutch Ludovicus Jan van der Velde, the CEO of these two structures.
This general context being recalled, it is time to mention the investigations of Nicola A. BORZI.
LINKS WITH THE FUTURE LEADERS OF TETHER AND BITFINEX
The investigations seem to reveal that the future bosses of Tether/Bitfinex assumed, from the mid-2000s, various responsibilities and functions within the electronics company Perpetual Action Group (PAG) and its international branches.
Van der Velde was CEO of the Asia department from 2006 to 2012 and Giancarlo Devasini liquidator of the Monegasque structure in 2009, according to the journalist. Devasini was also the “inventor” of a DVD content protection device for PAG, which was later sold to the European branch of Hustler, a giant in adult content.
Another commercial entity, this time specialized in photovoltaic, appears in the Operacion Medina file and the journalist’s research: Yuraku, based in Singapore. In the course of his demonstration, the author of the investigation points out that the US branch of this company was liquidated on July 2, 2012 by Ludovicus Jan van der Velde, who was its CEO.
PAG and Yuraku would have particularly benefited from the “Platone system”, the latter relying on sectors (electronics and solar energy) particularly conducive to exotic financial arrangements, to feed its vast VAT fraud system. As these two entities are managed (or even liquidated) by Devasini and Van der Velde, the question arises as to their degree of knowledge and involvement in Platone’s affairs.
The article also goes into great detail about the existence of complex arrangements and the supposed desire of Gennaro “Rino” Platone to cover his tracks by multiplying companies and liquidations. In this interweaving of facts, dates and interconnections, the names of the CFO and CEO of Bitfinex and Tether come up from time to time, without it being possible, however, to differentiate with precision between what might be related to traditional business relations and what might have constituted possible unethical behavior, or even offenses.
Rino Platone is currently on parole following the Spanish judgment in the “Operacion Medina” case, in which he was sentenced to 3 terms of 7 months each for tax fraud and a term of 6 months for criminal association, for a total of 27 months in prison.
The investigations continue, however, and after the judicial phase proper, it is now the work of journalistic ant that will perhaps allow new potential scandals to emerge from this sprawling file.
As it stands, it should be noted that Ludovicus Jan van der Velde, Giancarlo Devasini and the companies Tether and Bitfinex have not been directly involved in the Spanish proceedings. The different parties have not wished to respond to Nicola Borzi’s requests.