Tether won’t pay $24M Bitcoin ransom, says alleged docs are fake

A Bitcoin extortionist tries to tempt Tether into giving up millions of dollars.

Stablecoin issuer Tether says it received a ransom note demanding 500 BTC ($24 million) or else hackers would leak company secrets to the public.

According to Tether, the purported docs show correspondence between its employees and Deltec Bank & Trust — the company’s Bahamas-based banking partner.

Tether says its extortionists claim the docs would “harm the Bitcoin ecosystem” if released.

“It is unclear whether this is a basic extortion scheme like those directed at other crypto companies or people looking to undermine Tether and the crypto community as a whole,” tweeted the company late Sunday. 

“Either way, those seeking to harm Tether are getting increasingly desperate.”

New York bans Tether for failing to back USDT

Tether’s relationship with the offshore Deltec is a fixture for Bitcoin critics who maintain something fishy is going on at the crypto company.

Tether, operator of the market’s largest stablecoin worth over $30 billion, for years claimed to back USDT one-to-one with US dollars in a Deltec treasury.

A company lawyer later admitted USDT was instead only 74% backed by cash and equivalents.

More recently, New York’s Office of the Attorney General (OAG) found the company repeatedly lied about its reserves and hid $850 million in losses from the crypto market at large.

“The OAG’s investigation found that, starting no later than mid-2017, Tether had no access to banking, anywhere in the world, and so for periods of time held no reserves to back tethers in circulation at the rate of one dollar for every [USDT], contrary to its representations,” reads a press release from last week.

[Read more: Bitcoin has a logo, so why doesn’t the Satoshi?]

Curiously, a Medium blog claiming ownership over a trove of sensitive Tether docs circulated on Twitter just hours before the OAG revealed its settlement.

Similar to the purported extortionists, that blog claims existence of a “private database dump” which “may lead to a crash of the whole Bitcoin ecosystem.”

This reads eerily similar to that ransom note…

Protos has reached out to the associated email address to confirm any link between that post and the ransom note sent to Tether, and we’ll update this piece should we learn more.

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