P Xenos and M Bacina
Bitfinex and Tether receive another class action lawsuit in US Courts
Another class action complaint has been filed against Bitfinex and Tether in the U.S. District Court for the Western District of Washington.
This lawsuit accuses the operators of Tether and Bitfinex of managing a sophisticated scheme to defraud investors, manipulate markets, and conceal illicit proceeds, by commingling their corporate identities and customer funds while concealing their extensive cooperation.
The lawsuit also alleges that the investors were lied to about the number of USDT tokens in circulation, as Tether has stated that the amount of tokens would always be the same as the amount of US dollars in the companies’ bank accounts. This allegedly allowed Bitfinex and Tether to fake market demand for cryptocurrencies through printing more USDT and using it to buy coins, in particular Bitcoin.
Bitfinex and Tether have labelled this as a “copycat lawsuit” to the one filed against them in the U.S. District Court for the Southern District of New York on 6 October 2019, which at the time, quite bombastically accused Bitfinex and Tether of creating the “largest bubble in human history,” and claiming ”well over a trillion dollars in damages”.
In a joint statement, the two companies continued to categorically deny the accusations, stating that (emphasis added):
As we predicted last month, mercenary lawyers continue to try to use Bitfinex and Tether to obtain a payday. To be clear, there will be no nuisance settlements or settlements of any kind reached.
Instead, all claims raised across both actions will be vigorously contested and ultimately disposed of in due course.
The companies have also attempted to galvanize the support of the whole crypto community stating that:
These absurd and groundless accusations are an attack on the growth, success and innovation of the entire digital token ecosystem, in which Bitfinex is proud to play a critical role.
The joint statement concluded with the assertion that, "our fight is the community’s fight,” and assured the community that it will continue to fight against the “meritless lawsuits”, and once (if) they are overturned, will begin to evaluate legal options available to them and bring an end to the "baseless claims”.