Large-scale raids took place at the German offices of Northern Data AG, which is partially owned by the issuer of the stablecoin Tether. The actions were prompted by the Swedish prosecutor’s office, which is investigating potential tax violations during Bitcoin mining. The investigation concerns the company’s activities in Sweden, where increased taxes have been imposed on cryptocurrency mining.
This is reported by Business • Media
Details of the Investigation and the Company’s Position
According to informed sources, investigators checked the Frankfurt office of Northern Data. The European prosecutor’s office reported that the raids occurred simultaneously in Germany and Sweden, with local tax and economic authorities conducting the investigation. Swedish law enforcement detained four individuals on suspicion of large-scale VAT fraud, with losses estimated at over €100 million. The investigation is examining whether the miner provided incomplete or distorted information to obtain tax benefits.
In an official statement, Northern Data expressed surprise regarding the incident and explained that the situation stemmed from a misinterpretation of tax legislation. The company emphasized that their rental of graphics processors is used exclusively for cloud computing, and all cryptocurrency operations are conducted in accordance with legal norms.
“Northern Data believes there is a misunderstanding regarding the taxation of its graphics processor offerings, which are intended solely for cloud computing, as well as the economic and legal structure of the company’s traditional cryptocurrency mining operations,” the company stated.
Market Reaction and Next Steps
Representatives of Tether, which holds a stake in Northern Data, reported that they are not involved in the management of the company and emphasized that they were not informed about the inspections. At the same time, they initiated their own investigation to assess potential risks.
The news of the raids provoked a sharp reaction from investors: Northern Data’s shares fell by over 10%, reaching a price of €17 per share. On the Deutsche Börse Xetra, the company’s quotes continue to remain under pressure.
Earlier, in 2024, former top executives accused Northern Data of fraud and tax evasion, as well as misleading investors about the company’s financial condition. Additionally, in October of last year, information emerged about the company’s intentions to sell its mining business and focus on developing artificial intelligence.