The dark side of Zug’s Crypto Valley

Canton Zug has been positioning itself as the global capital of cryptocurrencies, but accusations of fraud engulfing cryptocurrency markets could curb its ambitions.  In the United States, legal proceedings implicating cryptocurrency exchange platform Bitfinex in a $850 million (CHF841 million) fraud scandal are forcing Zug’s so-called “Crypto Valley” to examine its dark side.  On April 24, 2019, New York state public prosecutor Letitia James opened proceedings against cyrptocurrency exchange platform Bitfinex, which is accused of having hidden some $850 million belonging to its clients.  Bitfinex is one of the few exchange platforms to invest in the Tether cryptocurrency, which was supposed to guarantee parity with the dollar through a cash reserve of greenbacks equal to the amount of Tether issued.  And there’s the rub: $850 million has disappeared from the reserve managed by Bitfinex. At the centre of suspicions is Panama company Crypto Capital, which had been tasked with ...
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