Tether Settles a $1 Trillion Lawsuit Regarding Manipulation

U.S. District Judge Katherine Polk Failla said: in charge The case was ruled in their favor. She dismissed half of the claims the plaintiff presented against the defendant. The remaining claims are tether and Bitfinex described them as “worthless.” Therefore, they are not going to reconcile with them.

A story of market manipulation

The plaintiffs who brought the case to court said the defendants were deceptive, market manipulative and anticompetitive. As a result, they claimed to have lost money. For over five years, Tether issued unbacked USDT tokens. Bitfinex then ended up buying cryptocurrencies on the open market to boost prices during market crashes.

This caused the cryptocurrency’s market capitalization to soar to $795 billion at the end of 2017, according to the complaint.

The plaintiffs are five crypto traders who allege that they purchased cryptocurrencies at inflated prices and suffered financial losses as a result. As a class action, this lawsuit represents everyone in the United States who may have been harmed by price gouging.

However, the defendant’s attorney argued in a supporting memorandum that the case would fail. Because of the accusation tether printed the USDT stablecoin without solid support based on the allegations. We have no direct knowledge or evidence on this matter.

They also argued that the plaintiffs had not proven at the time that virtual currency prices were in fact artificial.

Under the memorandum, the court will reject claims of market manipulation and RICO conspiracy. The reason is that the plaintiff cannot prove that he suffered financial loss at the hands of the defendant.

The court will also reject claims of anticompetitive and monopolistic conduct. The class action lawsuit failed to prove how the defendants sought to inflate prices and assert a dominant market position.

A series of lawsuits

In 2019, New York State Attorney General Letitia James said she was investigating Bitfinex. Tether has attracted attention in part because of its partnership with exchanges. The case centered around an alleged concealment of $850 million in losses. It was also around this time that Tether’s lawyers admitted that Tether only had 74% support.

Tether was able to settle its lawsuit with New York State. Under the terms of the settlement agreement, Tether is prohibited from doing business in New York. Bitfinex and Tether have not admitted wrongdoing, but the court fined them $18.5 million.

The court also required Tether to submit quarterly reserve reports for the next two years. Since then, lawsuits both large and small have been mounting regarding Tether and Bitfinex.

this article Originally posted on FX Empire

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