Cryptocurrencies
Bitfinex Crypto Case Shows Smaller Investors Face Greater Risk
- Crypto Capital is said to handle retail clients of Bitfinex
- Companies are accused of hiding loss of about $850 million
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The latest allegations against a major player in the nascent world of cryptocurrencies have something in common with past financial scandals: The little guy may end up holding the bag.
In a civil suit filed Thursday, New York’s attorney general accused one of the largest Bitcoin exchanges of hiding the loss of about $850 million in client and corporate cash. Multimillion-dollar accounts were protected, sometimes by the use of custodian banks in New York. Smaller investors received less assurance, with their funds sent to firms around the world, according to two people with knowledge of the matter.