Tether and Bitfinex Accused of Crypto Market Manipulation in Amended Complaint
A class-action lawsuit against Tether and Bitfinex has been amended with fresh accusations of crypto market manipulation. The plaintiffs allege that the companies artificially inflated cryptocurrency prices, including Bitcoin, through a scheme involving Tether’s USDT stablecoin.
Key Allegations
- Tether and Bitfinex are accused of “executing a sophisticated scheme to fraudulently inflate the price” of cryptocurrencies.
- The plaintiffs claim that the companies made “massive, carefully timed purchases” of cryptocurrencies to signal high demand, leading to price spikes.
- The complaint alleges that Tether issued billions of USDT without any dollar backing, violating the Commodities Exchange Act (CEA) and the Sherman Antitrust Act.
Evidence Presented
The plaintiffs have presented evidence that allegedly shows suspicious trading activity on the Bitstamp exchange, supporting their claims of market manipulation. They argue that Tether and Bitfinex used unbacked USDT to purchase large amounts of cryptocurrencies, artificially inflating their prices.
Tether and Bitfinex Denials
Tether and Bitfinex have consistently denied the allegations, maintaining that USDT is fully backed by reserves. They argue that the plaintiffs’ claims lack evidence and misunderstand the dynamics of the cryptocurrency market.
Implications for the Crypto Industry
This ongoing legal battle could have significant implications for the cryptocurrency industry. The outcome of the case could impact the regulation and oversight of stablecoins like USDT.
The case is still in progress, and it remains to be seen how the courts will rule on these accusations.
