Bitfinex said to find Caribbean bank after Wells Fargo exit
Due diligence in the sometimes shadowy universe of digital money often means trying to unscrew the inscrutable.
Bitfinex, one of the largest virtual-currency markets, has been a particular mystery in the crypto world. It was dumped early last year by Wells Fargo & Co. and since then it’s been a secret how the exchange could transfer fiat money, still the lifeblood of global finance, without a bank.
According to three people with knowledge of the matter, Noble Bank International, based in San Juan, Puerto Rico, took over banking duties for Bitfinex last year. As a stopgap between Wells Fargo’s exit and Noble’s entrance, Bitfinex used a string of third-party accounts based in Panama City to stay in the game, according to online documents.
Also affected is Tether, a digital currency traded on cryptoexchanges worldwide that shares a management team with the exchange, including Chief Executive Officer Jan Ludovicus van der Velde. While little public information exists about how Tethers are created, it generally trades for around $1 because each coin is supposed to be backed by $1 of fiat money in a bank. The currency, which started trading in 2015, is described as a stable alternative to Bitcoin’s volatility and can act as a safe haven for crypto investors.