Tether Limited has announced its intention to file a motion to dismiss a lawsuit that alleges that Tether and Bitfinex coordinated to cause the Bitcoin bubble of late 2017 via overt market manipulation.
The class-action lawsuit, brought forth by a group of cryptocurrency speculators and investors, states that Tether Limited and Bitfinex are responsible for all of the crypto market losses during the bear market of 2018, since large amounts of unbacked Tether stable coins were printed and injected into the market, causing the price of Bitcoin and other cryptocurrencies to rise well above their equilibrium and ultimately resulting in the crash of early 2018.
However, Tether Limited points out that the class action lawsuit is entirely based on the findings of an unpublished academic paper by John M. Griffin and Amin Shams. Apparently this paper was recently revised to remove one of its key allegations, that trading patterns reveal the issuance of unbacked Tether stable coins. Further, Tether also points out that many other factors caused the crypto bubble which peaked in late 2017, and that it is nonsensical to believe that Tether, which has a relatively small circulating supply, could influence the entire crypto market.
It remains to be seen if this motion to dismiss will succeed, and regardless the New York Attorney General’s Office lawsuit against Bitfinex and Tether Limited continues.
Image Courtesy: Pixabay