Class Action Accuses Tether and Bitfinex of Market Manipulation

Class Action Accuses Tether and Bitfinex of Market Manipulation

Class Action Accuses Tether and Bitfinex of Market Manipulation

A New York-based legal firm has filed a lawsuit against Tether and Bitfinex, accusing them of cryptocurrency market manipulation.

The lawsuit filed by Roche Freedman specifically accused Bitfinex and its subsidiary of creating a "sophisticated scheme" that took advantage of the cryptocurrency innovation to "defraud investors, manipulate markets and hide illicit proceeds". The plaintiff claims the defendant's actions amounted to over $1.4 trillion United States dollars in losses.

This comes some months after the company was dragged for lying to the general public that its stablecoin is completely backed by the United States' official currency - the US dollar.

Remarkably, the lawsuit takes into consideration Tether and Bitfinex's own preemptive rebuttal, describing it as an indication that the companies are "fully aware of the incredible harm they've inflicted on the cryptocurrency market".

"The crimes committed by Tether, Bitfinex, Crypto Capital, and their executives include Bank Fraud, Money Laundering; Monetary Transactions Derived From Specified Unlawful Activities, Operating an Unlicensed Money Transmitting Business, and Wire Fraud", the filing states. They violated the US Commodity Exchange Act, the RICO (Racketeer Influenced and Corrupt Organizations) Act, and money laundering law.

Count V alleges a violation of the federal RICO statute, which aims to prevent organized crime. Lastly, Count VIII seeks injunctive relief. Roche Freedman, which recently won the lawsuit against Craig Wright, who claims he created bitcoin, represents the plaintiffs.

Bitfinex, Tether, Digfinex, and current executives; former chief strategy officer Philip Potter; and payment processor Crypto Capital are named as the case's defendants.

Bitfinex fired back, saying that "Bitfinex and its affiliates have never used Tether tokens or issuances to manipulate the cryptocurrency market or token pricing", and that it was "irresponsible" to suggest otherwise. Tether claimed to be backed 1:1 by fiat reserves, but its issuer revealed earlier this year that it may also use other assets to support its value.

Meanwhile, in his daily commentary, Mati Greenspan, Senior Market Analyst at eToro, stressed that in major financial institutions across the globe, the process of creating unbacked currency for the goal of purchasing financial assets and propping-up market prices is simply known as common practice.

Notícias recomendadas

  • Trump declares it in writing: He won’t cooperate in impeachment probe

    As the process continues, the Trump team is gearing up for a full-scale war against the Democrat-led effort for impeachment. The letter says the manner of the inquiry violates fundamental fairness and constitutionally mandated due process .
    Peebles, Mayor and Queloz win 2019 Nobel Prize for physics

    Peebles, Mayor and Queloz win 2019 Nobel Prize for physics

    He said he answered a 5:30 a.m. phone call on Tuesday thinking "it's either something very wonderful or it's something terrible ". During the conference, Peebles spoke about his work and about his surprise of being awarded the Nobel.
    Two people killed in shooting in German city of Halle

    Two people killed in shooting in German city of Halle

    The central train station has been closed while the area is under lockdown, rail company Deutsche Bahn said. Two people were killed and several injured in a shooting in eastern Germany , police told Euronews.
  • Turkey summons US diplomat over Twitter ‘like’

    Turkey summons US diplomat over Twitter ‘like’

    Bahceli is the leader of Nationalist Movement Party (MHP), which is an ally of President Tayyip Erdogan's AK Party. We do not associate ourselves with Ergun Babahan nor do we endorse or agree with the content of his tweet.
    USA  economy likely to keep growing: Federal Reserve's Powell

    USA economy likely to keep growing: Federal Reserve's Powell

    The Fed has cut interest rates twice this year to shelter the US economy from weak global growth and trade-policy uncertainty. Mismeasurement of productivity may have actually understated growth in gross domestic product in recent years, Powell said.
    Philippines slips in World Economic Forum competitiveness ranking

    Philippines slips in World Economic Forum competitiveness ranking

    The accessibility of fiber optic broadband internet access also "remains the privilege of the few", the report added. The World Economic Forum has ranked Singapore in the top spot for global business competitiveness this year.
  • Rooney's wife accuses Vardy's wife of leaking stories to press

    Rooney's wife accuses Vardy's wife of leaking stories to press

    Coleen made a decision to take the direction of exposing her to the world and shaming her for these acts of cowardice. The two footballer's wives were believed to have been friends as both their husbands played for England .
    Man United loanee Henderson wins first senior England call-up

    Man United loanee Henderson wins first senior England call-up

    Wilder, though, had always felt the young goalkeeper could quickly put it behind him. "Dean has made a couple of mistakes in his time and he has recovered wonderfully well".
    Carolina Panthers Week 5 grades vs. Jacksonville Jaguars

    Carolina Panthers Week 5 grades vs. Jacksonville Jaguars

    After suffering a home loss earlier in the season, another win would help not only maintain momentum heading into the bye week but also in the standings.
  • Wales wary of Fiji's giantkiller reputation

    Wales wary of Fiji's giantkiller reputation

    Dan Biggar also retains his place in the starting side, having failed a HIA during the crucial win against Australia. James Davies replaces rested Justin Tipuric, while number eight Ross Moriarty comes in for Aaron Wainwright.
    Google Pixel 4 leaks reveal premium price and ‘astrophotography’ camera mode

    Google Pixel 4 leaks reveal premium price and ‘astrophotography’ camera mode

    They would also feature a new Motion Sense Mode and work with nine applications that have been whitelisted as Supported Apps. Recently it was also confirmed that Google Pixel 4 will come in three colours: Just Black, Clearly White and Oh So Orange.
    Bernie Sanders says he may slow down campaigning pace after heart attack

    Bernie Sanders says he may slow down campaigning pace after heart attack

    Bernie Sanders: I don't think it helps, or hurts, but I'll tell you one thing that I look forward to doing". Riggs' obituary says she met Levi Sanders while the two worked at an emergency food shelter in Vermont .

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.