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Cryptocurrency exchange Bitfinex and stablecoin issuer Tether, along with their iFinex parent, thought they could convince a judge in New York that the state had no jurisdiction over the entities. They have failed and New York Attorney General (AG) Letitia James is going to be able to continue her investigation of the companies, at least for another three months.

The AG has been investigating the companies for allegedly offering their services to individuals in New York, although they aren’t licensed to operate there. Bitfinex countered that there were no NY-based activities being conducted, which meant that the state had no jurisdiction over them. However, New York Supreme Court Justice Joel M. Cohen has now rejected the appeal and said that an injunction against the companies will continue for at least another 90 days.

The injunction states, in part, that Tether is not allowed to give Bitfinex any more money. It previously sent $850 million to the exchange to bail it out of a fiscal jam and that loan has been at the heart of the AG’s attack on the companies.

Justice Cohen stated last week, “I will extend the injunction…if I dismiss the case then obviously the injunction goes with it. If I don’t dismiss the case the injunction will be extended.” He added that “the idea is to keep things where they are until the decision of this motion, so the decision is to extend the stay and…extend the injunction.”

Perhaps in a vain attempt to try and offer a mea culpa for not doing a better job of policing its network, Bitfinex tried to assert last week that a single U.S.-based customer had used its platform, and that the company had taken measures to ensure that nothing similar could happen in the future. Despite the acknowledgement, AG James has already produced evidence that dozens of traders in the U.S. have been regularly using the platform. Frank Chaparro, director of news for The Block Crypto, has been following the developments closely and reportedly has feet on the ground in New York to provide updates. A Twitter feed on the subject has offered input and will continue to help keep the crypto community informed.

In another example of Tether’s potentially shady business practices, the company reportedly just created a multibillion-dollar “Monero-Like dark pool using Liquid.” This comes from a Medium post from Coin Monks that points to some interesting activity in the blockchain space. In summary, a serious amount of money was moved between unknown SegWitCoin (BTC) wallets just prior to an announcement that the Liquid Network was now supporting Tether. The timing of the movement has led to speculation that Tether could have paid a handsome price to be added to Liquid. The Medium post does a great job of explaining how Coin Monks reached its conclusion.

It has long been claimed that Tether was up to no good, especially given the company’s lack of willingness to allow a third party to audit its books. When it recently surfaced that the stablecoin is no longer backed one-on-one to any fiat, and that Tether had used funds to invest in other crypto projects, those claims gained additional support. Anyone who still remains behind Tether at this point is asking for trouble.

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