Cryptocurrency giants Tether and Bitfinex are facing fresh allegations of market manipulation. A newly amended class action complaint filed in the United States District Court for the Southern District of New York accuses the two companies of breaking antitrust laws and manipulating the market.
The recent filing claims that Tether and Bitfinex violated the Commodities Exchange Act (CEA) by engaging in market manipulation, monopolizing, and making agreements that restrict trade. The complaint alleges that Tether and Bitfinex inflated the price of crypto commodities, including Bitcoin, by issuing Tether’s USD-backed stablecoin, USDT, into the market without proper backing. This move allegedly created a false sense of high demand, driving up cryptocurrency prices.
Who’s Behind the Lawsuit?
The plaintiffs, Matthew Script, Benjamin Leibowitz, Jason Leibowitz, Aaron Leibowitz, and Pinchas Goldshtein, brought these accusations forward as part of an ongoing class action lawsuit. The new complaint, which is a revised version of an earlier filing, is being overseen by Judge Katherine Polk Failla. This latest document includes twelve causes of action, up from the eight in the original complaint.
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The case has had its fair share of twists and turns. Notably, the crypto law firm Roche Freedman, which initially represented the plaintiffs, withdrew from the case. The firm’s founder, Kyle Roche, was caught up in controversy after videos surfaced showing him allegedly admitting to filing frivolous lawsuits to benefit his clients. These revelations damaged his credibility and led to his removal from the case.
According to the lawsuit, there are chat and deposition logs from Tether and Bitfinex operators that reportedly confirm their involvement in manipulative practices. This evidence aims to back up the plaintiffs’ claims of market manipulation. However, a spokesperson for Tether has strongly denied these allegations, calling them unfounded and baseless.
What This Means for the Crypto World
This lawsuit comes at a critical time for the cryptocurrency industry, which is under increasing scrutiny from regulators. The outcome of this case could have major implications for how stablecoins and cryptocurrency exchanges are regulated. If the plaintiffs win, it could lead to stricter oversight and significant changes in the crypto market.
As this case unfolds, the entire crypto community is on high alert. These allegations are not just about potential financial wrongdoing; they also challenge the trust and integrity of the cryptocurrency market. The results of this lawsuit could reshape the future of digital currencies and their regulation.
Stay glued to The BIT Journal for more breaking news on this and other important developments in the world of cryptocurrency. Our team will keep you updated with the latest news and in-depth analysis as new information comes to light.
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