Tether's banking partner, Britannia Financial, is reportedly entangled in a lawsuit due to alleged unpaid amounts linked to revenue-generating assets tied to substantial Tether deposits.
The Financial Times reported on November 21 that Arbitral International, a British Virgin Islands-based entity, has filed a lawsuit against Britannia for around $1 billion related to Tether deposits. Court documents filed in London's High Court in 2023 are said to be the basis of this legal action.
The lawsuit centers on Britannia's acquisition of Arbitral's Bahamas-based brokerage business, Arbitral Securities. This acquisition, initially announced by Britannia in October 2021, involved integrating the acquired brokerage into its own platform, Britannia Securities.
The legal dispute reportedly revolves around an agreement between Britannia and Arbitral, stipulating that Britannia Financial would make an additional payment based on the revenue-generating assets held by Arbitral Securities a year after the acquisition. Allegedly, this would also encompass clients initially introduced by Arbitral or its affiliates. Tether reportedly opened an account at a Britannia Financial subsidiary in November 2021, as indicated by court documents.
Reports suggest that Aldo Mazzella, labeled as a "professional introducer," introduced Britannia Financial to Tether, establishing a commercial relationship around 2017. Arbitral, however, argued that an executive from Arbitral Securities also played a part in facilitating the Britannia-Tether partnership.
Several months ago, Bloomberg reported Tether's association with Britannia Bank and Trust, a Bahamas-based private bank, to manage U.S. dollar transactions. Other banking collaborators reportedly include Deltec Bank and Capital Union Bank. Tether's CTO and new CEO, Paolo Ardoino, has previously claimed the stablecoin company maintains strong ties with over seven banks.
A spokesperson for Tether emphasized their commitment to secure banking practices worldwide, prioritizing the safeguarding of token holders' interests. Tether's assets are predominantly invested in Treasury securities to facilitate access to numerous banking partners and ensure robust protection against potential challenges.
Tether's stablecoins have experienced substantial growth, steadily approaching a $90 billion market capitalization, per CoinGecko data. The value of USDT reached $88 billion on November 20, marking a 33% surge from the start of 2023. This remarkable growth is attributed to ongoing excitement surrounding the possible approval of a spot Bitcoin exchange-traded fund (ETF) and escalating demand from emerging markets like Brazil, according to Tether.
