January 29th, 2019
22 months since Wells Fargo suspended the processing of withdrawals sent by four Taiwanese banks that service Bitfinex, the platform remains among the top 20 exchanges by adjusted volume. While Bitfinex hosted more than $5 billion in a trade this past month, the exchange has struggled to establish reliable banking partners, with traders seeking to deposit fiat currency having been instructed to send funds via at least seven different banking institutions since the Wells Fargo suspension.
Bitfinex Directs Customers to Deposit Funds With Polish Bank 7 Months After Wells Fargo Termination
During Nov. 2017, it was reported that Bitfinex customers were being directed to deposit fiat currency with Polish-based bank Spółdzielczy w Skierniewicach under the account of Panama-based company Crypto SP, an account that was also revealed to be shared with cryptocurrency exchange CEX. Crypto SP was also found to be owned by Crypto Capital, a company owned by Ivan Manual Molina Lee, an individual found to be a nominee director for a number of Panama-based companies.
During January 2018, it was reported that Bitfinex had been subpoenaed by the United States Commodity Futures Trading Commission (CFTC). The months following the news of the subpoena saw Bitfinex appear to cycle through banking partners in short succession, with traders being instructed to make fiat deposits with at least six different financial institutions between Feb. 2018 and Nov. 2018.
Bitfinex Customers Directed to Deposit Funds With at Least 6 Banks During 2018
At the start of Feb. 2018, a post on Reddit indicated that a Bitfinex customer had been directed to deposit funds with Portuguese-state owned banking institution Caixa Geral De Depositos via a company called Global Trade Solutions. One Redditor speculated that Global Trade Solutions may be linked to Crypto S.P and Crypto Capital.
On Feb. 14, 2018, Dutch media outlet Follow the Money reported that a spokesperson for ING had confirmed that Bitfinex held an account with the bank in the Netherlands. The news comprised the first announcement of a major financial institution since Wells Fargo suspended wires from Bitfinex almost one year prior.
Bitfinex Briefly Partners With Noble Bank
During May 2018, it was reported that Bitfinex had partnered with Puerto Rican financial institution, Noble Bank whose principal custodian was Bank of New York Mellon.
Three months later, a report published on Medium asserted that Brock Pierce, the founder of Tether, and John Betts, the founder of Noble Bank, had sought to acquire Mt. Gox together in 2014 via Sunlot Holdings’ Mtgox Rehabilitation Plan Proposal. After their bid was unsuccessful, both men would go on to found their respective companies later that year.
At the start of October 2018, it was reported that Noble International had been looking for a buyer for months, and had lost many of its customers including Bitfinex and Tether. A few days later, it was revealed that Bitfinex was directing customers to deposit fiat currency into an HSBC account held by Global Trading Solutions.
Later that month reports also indicated that Bitfinex was banking with Hong Kong-based Bank of Communications via the private accounts of “Prosperity Revenue Merchandising Limited” for whom Citibank acts as an intermediary bank.
In November, Bitifinex announced another new banking partner, publishing a letter attributed to Bahamas Deltec Bank & Trust asserting that the company held $1.8 billion in its account as of Oct. 31.
Bitfinex’s Cayman-Based Bank Falsely Claims SEC Registration
During January 2019, it was revealed that Bitfinex was banking with Cayman Islands-based Sackville Bank & Trust Company. Sackville’s principal custodian bank is CIBC Mellon which is jointly owned by The Bank of New York Mellon and Canadian Imperial Bank of Commerce.
While discussing Wells Fargo’s suspension of wire transfers to and from Bitfinex, the exchange’s former chief strategy officer, Phil Potter, previously stated: “We’ve had banking hiccups in the past, we’ve always been able to route around it … open up new accounts … shift to a different entity, lots of cat and mouse tricks.”