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Market Musings

Tether Told to Pay 500 BTC or Documents Will Leak, But Company Isn't Paying Up

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Published on:
March 1, 2021

"While we believe this is a pretty sad attempt at a shakedown, we take it seriously," the stablecoin issuer says.

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Days after finally settling a long-running legal dispute with the New York attorney general, Tether has a new crisis to deal with.

 

The stablecoin company says “forged documents” are circulating online that claim to be from Tether’s representatives — and that it has received a ransom demand for 500 BTC.

 

In a Twitter thread posted on Sunday, the stablecoin issuer added:

“The sender said that, unless they receive the BTC by tomorrow, they will leak documents to the public in an effort to ‘harm the Bitcoin ecosystem.’ We are not paying.” 

It’s certainly a hefty ransom demand. At the time of writing, 500 BTC is worth $24.1 million.

 

The company says that it isn’t clear whether this is a basic extortion scheme, or something more malicious that’s designed to “undermine Tether and the crypto community as a whole” — writing:

“Either way, those seeking to harm Tether are getting increasingly desperate.”

Tether also urged its customers to stay safe and secure, adding:

“While we believe this is a pretty sad attempt at a shakedown, we take it seriously. We have reported the forged communications and the associated ransom demand to law enforcement. As always, we will fully support law enforcement in an investigation of this extortion scheme.”

Ransom demands have become increasingly common in the crypto space — with criminals favoring digital currencies because there can be a greater chance of anonymity. However, many extortion attempts often involve the use of ransomware that encrypts files on a person’s computer… or takes down a company’s network.

 

Tether’s determination not to pay follows the recommended course of action, with security officials warning that bowing to ransom demands can embolden criminals to perform further attacks.

 

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