Bitfinex takes Wells Fargo to court over suspended wire transfers

Bitfinex takes Wells Fargo to court over suspended wire transfers

Digital currency exchange Bitfinex has filed a lawsuit against Wells Fargo over embargoed U.S. dollar wire transfers.

Bitfinex takes Wells Fargo to court over suspended wire transfersThe lawsuit, filed last week in Northern District of California federal court San Francisco division, sought “a preliminary and permanent injunction against Wells Fargo. Plaintiffs Tether Limited and iFinex, which operates Bitfinex, are also seeking compensatory damages in excess of $75,000 and any additional relief the court may deem fair as well as a jury trial for the case.

Bitfinex is not a customer of Wells Fargo per se, but it is a customer of four Taiwan-based banks, which, in turn, use Wells Fargo as a correspondent to process U.S. dollar wire transfers. The digital currency exchange said Wells Fargo has been performing its duty for the past two years, claiming that the U.S. bank knew of its cryptocurrency business through the Taiwanese banks’ know-your-customer (KYC) process.

However, Wells Fargo reportedly suspended U.S. dollar wire transfer operations from a group of Taiwanese banks in the latter half of March, although it remains unclear why the U.S. bank decided to do this. Bitfinex accused Wells Fargo did not contact them to explain the suspension, which affected the exchange’s outgoing wire transfers. Incoming wires into Bitfinex’s accounts continue to be processed as usual.

Bitfinex claimed that Wells Fargo’s sudden action “presented an existential threat” to its business as the suspension prevented the exchange from fulfilling its obligations to its customers. This, according to Bitfinex, will result in the company losing its existing and prospective customers, who may think that the failure in wire transfers is Bitfinex’s fault.

The outcome of Bitfinex’s lawsuit could bring clarity to the long-debated legality of shuttering bank accounts that are connected to cryptocurrency trading.

Bitcoin poised to reach $500,000 by 2030

Despite being one of the top-performing currencies today, bitcoin has yet to come close to its full potential, said Jeremy Liew, the first inventor in Snapchat.

In a presentation sent to Business Insider, Liew and Blockchain CEO and co-founder Peter Smith forecast the digital currency to “realistically reach $500,000 by 2030.”

“Expats sending money home have found in bitcoin an inexpensive alternative, and we assume that the percentage of bitcoin-based remittances will sharply increase with greater bitcoin awareness,” the two said.

But there’s still a long way to go before 2030. For now, bitcoin is trading above the $1,200 level.