Tuesday, June 22, 2021

Bitfinex blames market manipulation lawsuit as shameless money grab attempt

The Takeaway:

Bitfinex and Tether are ready to file a lawsuit against "bogus study" research that blames USDT for the price rise, and the study claims that Bitcoin gains correlate with Tether issuance. The companies called out the lawsuit as a shameless way to make money.

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In recent news, cryptocurrency exchange Bitfinex and the stablecoin Tether have found themselves in another public relations crisis management situation. An immediate lawsuit is possible for the companies accusing them of market manipulation, and they have called out this as just a shameless way to make some money.

Both Bitfinex and Tether issued statements on 5th October, stating that they are waiting for a pointless lawsuit, which is based on a “research” study to be filed against them. They said that they have heard about an unpublished paper that claims that USDT issuance is responsible for the manipulation of the cryptocurrency market.

The companies did not specify the research paper, but recently, Bloomberg published a story about how Bitcoin gains are correlated to the issuance of Tether. According to the study, it was said that BTC price rises whenever new tether coins are minted. Bitfinex and Tether have accused researchers saying the report is based on cherry-picked data and faulty methodology.

Bitfinex and Tether were disappointed to find out the report, and they are ready to fight vigorously to defend themselves against any legal action. They further added that the attack on them is an attack on the entire digital token community. This is not the first time that USDT has been accused of involvement in cryptocurrency market manipulation.

Despite these accusations, USDT remains the top dollar-pegged digital instrument. It is the fourth most valuable token in terms of market cap, and its contenders have failed to compete with its trade adoption levels. The most significant risk for the companies, though, is the possible action by U.S. authorities.

Earlier, the New York Attorney General’s s(NYAG) office revealed that they are keeping their eyes on the stablecoin and accused the companies that they lost $850 million funds. They also requested documents that were related to Tether to be handed over to the authorities.

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Ramon AnderSon
Ramon AnderSon
Ramon is a senior market research analyst who is very passionate about bitcoin. He has a degree in Applied Science from Assumption College, Worcester.

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