Cryptocurrency News

Bitfinex Top-Brass Phil Potter Tenders Resignation

Crypto exchange heavyweight Bitfinex’s chief strategy officer Phil Potter is leaving the company, it was announced early on Tuesday (June 26). Potter will be replaced on an interim basis by J.L. van der Velde, the company’s chief executive. Officially Potter has resigned, but did he in fact jump… or was he indeed pushed?

On Tuesday it was announced that Phil Potter – chief strategy officer at the Bitfinex cryptocurrency exchange – would be leaving the company and replaced with immediate effect by the company’s chief executive J.L. van der Velde, who will hold the position on an interim basis. A company spokesperson told the press that Potter’s decision to leave was a “mutual” parting.

Did Phil Potter Jump Ship?

According to a statement released by Bitfinex, Potter believed it was time to leave the executive team and “seek other opportunities”. Meanwhile, Bitfinex “pivots to other strategic international markets.” In a statement Potter said:

“As Bitfinex pivots away from the U.S., I felt that, as a U.S. person, it was time for me to rethink my position as a member of the executive team.”

Founded in Hong Kong in 2012 by Raphael Nicolle and Giancarlo Devasini, Bitfinex is owned by iFinex Inc., a British Virgin Islands company. Bitfinex is the fourth-largest cryptocurrency exchange in the world, based off trading volume. Like its contemporaries such as Binance, Bitfinex enables traders with the ability to buy and sell virtual currencies such as Bitcoin and Ethereum with ease.

Recently, crypto exchanges have been attracting much negative press, mainly due to some high profile hacks which have questioned their standards of security. While Bitfinex has also had its share of hacks and thefts, right now it has been grabbing negative attention for other reasons.

Were Bitfinex and Tether Behind Bitcoin’s 2017 Price Surge?

In recent months, Bitfinex has drawn attention – suspicion even – to itself because of its links with crypto startup and stablecoin Tether. Tether shares management with Bitfinex, and because of its status as a stablecoin, has a coin valuation that is “stable” and cannot fluctuate.

In the case of Tether, its coins – USDT – are each worth precisely one US dollar, and the company only produces the Tether coins it can cover the value of. This has drawn some critics to questioned whether Tether does indeed actually hold $1 in reserve for every token Tether issues, as it claims it does.

Last December the US CFTC (Commodity Futures Trading Commission) subpoenaed Bitfinex and Tether over this issue. At the time of writing, that investigation is still ongoing.

In a separate matter, earlier this month a research paper from the University of Texas suggested that Tether’s tokens might have been used to somehow manipulate the crypto market and aid Bitcoin’s historic price rise from $900 to $19,900 within a period of months last year. Critics claim Tether operated a fractional reserve designed to inflate Bitcoin’s price and hide the exchange’s insolvency.

Bitfinex has denied these allegations and intends to take legal action against whoever is making such defamatory claims.

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