Crypto exchange Bitfinex has begun repaying the $700 million loan it received from its sister company Tether.
Legal findings from the New York Attorney General (NYAG)’s office revealed that Bitfinex borrowed the money in early 2019 to cover a loss of $850 million after the exchange’s payment processor had its funds seized.
Bitfinex announced the first payment on Tuesday after transferring $100 million from its account to Tether’s.
“Bitfinex made this payment in fiat wired to Tether’s bank account,” said the company. “This amount was not yet due to be paid to Tether under the facility, but Bitfinex has made the prepayment based upon its financial position at the end of the second quarter of 2019.”
“Also on July 1st, Bitfinex fully prepaid all interest accrued under the loan facility to Tether up to the end of day on June 30, 2019, also in fiat,” the exchange added.
Despite sharing key executives and shareholders, both Bitfinex and Tether continue to maintain that they are separate companies. The NYAG had accused their parent company, iFinex, of facilitating collusion between the two companies to cover up Bitfinex’s $850 million loss.
iFinex has since filed a motion to dismiss, which the NYAG can oppose by July 8. Their legal wrangling will continue in court on July 29.