Bitfinex is a cryptocurrency exchange owned and operated by iFinex Inc., which is headquartered in Hong Kong and registered in the British Virgin Islands.
In 2015 the exchange’s customers were hacked, losing about $400,000, and in 2016 about $73 million more was stolen from its customers’ accounts. The exchange’s access to U.S. dollar payments and withdrawals was then curtailed. In October 2018, Bitfinex again had serious difficulties with its banking relationships. Its management stated “Bitfinex is not insolvent on October 7.”
In April 2019 New York Attorney General Letitia James filed a suit accusing Bitfinex of using the reserves of Tether, an affiliated company to cover up a loss of $850 million to a Panamanian payment processor known as Crypto Capital Corp.Reggie Fowler, who is alleged to have connections with Crypto Capital, was indicted on April 30, 2019, for running an unlicensed money transmitting business for cryptocurrency traders.
Research suggests that price manipulation of bitcoin on Bitfinex accounted for about half of the price increase for bitcoin in late 2017.
According to a statement by Bitfinex prior to the offering of $1 billion in tokens, Bitfinex had a net profit of $404 million in 2018. These results were not audited, nor prepared under Generally Accepted Accounting Principles.