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Bitfinex Chief Strategy Officer Phil Potter Exits Company

 

According to Reuters, Phil Potter, chief strategy officer of Bitfinex has tended in his resignation and would be replaced by the current chief executive officer (CEO) of the company J. L. van der Velde as an interim measure. A spokesperson for the Bitfinex cryptocurrency exchange asserted that Potter`s exit from the company was not acrimonious but instead a “mutual” separation, Reuters reported.

 

A statement released by the cryptocurrency exchange noted that the exit of Potter from the company`s leadership team so as to explore other available opportunities out there comes at time Bitfinex has its sights set on doing business in “strategic international markets.” The management team of Bitfinex until this recent resignation comprised the CEO, Potter and an Europe-based chief financial officer.

 

Bitfinex is owned by the British Virgin Islands and has earned the reputation for being the world`s fourth largest cryptocurrency exchange based on trade volumes. However it has not been free from controversies. Bitfinex was implicated in a money laundering operation involving a Columbian drug cartel. This was disclosed in April this year following investigations carried out by Polish authorities. In this instance also, the company vehemently denied its involvement in the money laundering operation

 

In recent times some analysts and pundits have had cause to raise questions about the existing relationship between Bitfinex and Tether; Bitfinex shares management with Tether, a company that deals in a cryptocurrency tied to the US dollar. Critics have repeatedly called to question Tether`s claim to holding $1 in reserve for every token the company issues.

 

Some organizations have gone to great lengths to have this issue addressed. In December last year, both Bitfinex and Tether were subpoenaed by the CFTC apparently because of this same issue.

A research paper prepared and released by the University of Texas earlier this month argued that Tether might have manipulated bitcoin prices with its token which eventually resulted in bitcoin`s unparalleled price increase in 2017.

 

Bitfinex has since debunked the unsavory arguments indicting the company as presented in the released research paper.

Some critics have alleged Tether`s involvement in the inflation of bitcoin`s price through the running of a fractional reserve in a bid to mask its insolvency. Bitfinex has flatly denied such a claim and threatened to sue critics for allegedly making false claims against the company.

 

Bitfinex eventually considered it appropriate to contract a Washington-based law firm to help set the record straight. After a thorough review of Tether`s token, the law firm co-foundered by a former FBI director Louis Freeh issued a report indicating that Tether`s token was sufficiently backed with US dollar reserves.

 

Reports suggest that as a consequence of the cryptocurrency price rally, regulators across the globe intensified their scrutiny of digital currencies. The alleged bitcoin price manipulation in 2017 is reportedly being investigated by the US Commodity Futures Trading Commission and the Department of Justice.

 

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