A US bankruptcy judge will allow Celsius Network to move forward with its legal fight
A US bankruptcy judge has ruled that Celsius Network may proceed with its lawsuit against Tether, the issuer of the USDT stablecoin, over a dispute stemming from the 2022 crypto market collapse. The legal battle centers on allegations that Tether improperly sold 39,500 Bitcoin—valued at over $4 billion at the time—that had been held as collateral for Celsius.
Celsius claims that the sale breached their agreement, which reportedly required Tether to provide at least 10 hours’ notice before liquidating any collateral. The crypto lender argues it suffered heavy financial losses due to the sale and is pursuing damages.
Tether, for its part, attempted to have the case dismissed, arguing that the transactions occurred outside US jurisdiction and were handled in accordance with prior agreements. However, Judge Martin Glenn denied Tether’s motion, stating that key aspects of the transaction—including systems and accounts—were based in the US, giving the court authority to hear the case.
The court has allowed Celsius to continue with major claims, including breach of contract, fraudulent transfer, and preferential transfer. However, it dismissed several other charges due to lack of evidence or jurisdictional limits.
This legal development comes as Tether’s USDT supply continues to grow, reaching a record $158 billion. Despite the lawsuit and questions around regulatory compliance, USDT remains the most dominant stablecoin in the market. Tether also recently reported $13 billion in profit for 2024 and has expanded its influence into areas like sports, acquiring a stake in Juventus Football Club.
Still, concerns linger. Critics continue to question whether Tether holds sufficient reserves to fully back its tokens. With the US Senate’s GENIUS Act advancing toward becoming law and new regulations on the horizon, the outcome of Celsius’ case could play a key role in shaping Tether’s future in the US market.
