- The lawsuit against Tether and Bitfinex filed in November 2019 has been revised and filed in a new jurisdiction.
- A new plaintiff has been added, and the rights of the Bitcoin distributors concerned are to be enforced.
A document from the Western District of Washington, dated January 7, shows that the lawsuit against Tether and Bitfinex for alleged manipulation of the cryptomarket was withdrawn. The plaintiffs did so voluntarily and then reintroduced the lawsuit in a new jurisdiction.
A new plaintiff against Tether and Bitfinex
The lawsuit was filed in November last year and was part of a series of legal suits alleging market manipulation. The plaintiffs’ arguments are supported by a study published last year. The study presented evidence that proved the alleged involvement of Tether and Bitfinex in the deliberate disruption of the cryptomarket.
The defendants issued several statements dismissing the results of the study. One of the statements says that the conclusions of the study are incorrect and questions its methodology. In addition, Tether and Bitfinex referred to their plaintiffs as “mercenaries” seeking profit.
According to the document introduced on January 7, 2020, the case was moved to New York State with the addition of David Crystal as a part of the case. Crystal, Eric Young and Adam Kurtz claim to be traders affected by the manipulation practices of Tether and Bitfinex. The original complaint states the following:
Once Defendants and their co-conspirators artificially inflated the price of Bitcoin, Defendants and their co-conspirators then converted the bitcoin back into USD₮s to replenish Tether’s reserves.
A Bitfinex representative questioned the actions of the plaintiffs. The company’s general counsel, Stuart Hoegner, stated that he did not understand the reason for changing the jurisdiction of the lawsuit. Finally, Hoegner said that this will not affect the outcome that will favor Bitfinex.
Validity of the Tether study
The study on which the claims are based was conducted by the firm Token Analyst. Its conclusions claim that Tether was used to manipulate the 2019 Bitcoin price increase. The study showed a correlation between the increase in Bitcoin price on the days new USDT tokens were issued.
According to Tether and Bitfinex, this type of legal action is only detrimental to the progress that digital assets have made, and especially against Tether’s role in the ecosystem. Both entities have stated that the outcome of the case could affect the entire industry and said that their fight is ijmportant for the entire crypto community.