Tether doesn’t believe there’s any merit to the accusation that it helped create the “largest bubble in history” and rejects claims that it has manipulated the cryptocurrency market in any way. The company that created the USDT stablecoin has come under fire for its actions on more than one occasion and a recently updated paper brought those allegations to the surface once again. A lawsuit almost immediately followed, entered by investors who believe they were misled by the company. Tether now hopes to have the “frivolous” lawsuit thrown out of court.
Last Friday, Tether filed a motion with the U.S. District Court in the Southern District of New York, requesting that the case be dismissed. It argues that the suit is full of holes and that it lacks “the required legal basis to proceed past the very early stage of the case.” The motion also asserts that the academic paper which prompted the lawsuit is “flawed” and that the authors, in amending their paper, reversed course on one of the core allegations listed in the suit.
The suit itself is flawed, according to Tether. It argues in a post on its website that the suit “claims, without evidence and in defiance of reason, that somehow Tether manipulated a market more than seven hundred times the size of total Tether USDT issuances in circulation between March and December of 2017, something that any sophisticated and rational observer of the digital token ecosystem knows to be ridiculous.”
Tether has had to deal with a string of complaints over the past couple of years, with more severe attacks having come in 2019. The stablecoin project, and crypto exchange partner Binance, are under investigation by the New York State Attorney General’s Office for a deal that went sideways following Tether’s $850-million bailout of the exchange. Tether and Binance are being sued by the office and the case will continue to play out in court next year.
Despite never willing to present data to support its holdings or financial standings before, Tether is ready to defend itself in court, which could obligate it to come clean. The company adds in its statement, “Tether looks forward to putting the true facts before the court at this stage and throughout the proceedings. The Plaintiffs continue to act in a way that undermines the many contributions of thousands of members of the digital token economy. Tether will vigorously contest Plaintiffs’ claims and relentlessly defend itself, its customers and stakeholders, and the cryptocurrency community.”
New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.