While Bitfinex, Tether Call BTC Price Manipulation Law Suits ‘Frivolous’ Accusations Still Flying


In spite of a court’s request, the plaintiff who brought Bitfinex into court based on allegations that the crypto exchange manipulated the Bitcoin (BTC) price denied amending complaints.

This comes after Tether and Bitfinex lawyers have requested the court to dismiss a lawsuit because the allegations are frivolous. The plaintiff based these allegations on research conducted by 2 Americans from the academic environment: University of Texas’ John Griffin and Ohio State University’s assistant professor Amin Shams, who were saying that Bitfinex allegedly used USDT tokens in order to manipulate the price of Bitcoin (BTC), back in 2017.

What Does the Griffin-Shams Study Say?

What the plaintiff noted in the most recent filing in court is that the Griffin-Shams study clearly concludes USDT was used to manipulate Bitcoin prices and that Bitfinex has used USDT to purchase Bitcoin while the prices were falling. This is the exact note in the filing:

“First, the study still concludes that USDT was being used to manipulate bitcoin prices. But importantly, the updates go further than the original study in connecting the manipulation to a single entity, concluding that ‘one large player on Bitfinex uses [USDT] to purchase large amounts of Bitcoin when prices are falling and following the printing of [USDT].’”

The same note also highlights that the study was published by the reputable Journal of Finance, and tries to blame Bitfinex executives for price manipulation:

“The study, which has been accepted for publication by the Journal of Finance, ‘strongly suggests Bitfinex executives either knew of the scheme or were aiding it.’ In fact, Professor Griffin has publicly told the Wall Street Journal that ‘[i]f it’s not Bitfinex, it’s somebody they do business with very frequently.’”

More than this, Griffin and Shams have published an updated version of their study, in which they claim only one Bitcoin whale was in fact responsible for price manipulation.

Bitfinex Has a Few Other Lawsuits Going On

Close to the end of November, Bitfinex had to deal with another second class-action lawsuit against it and its token issuer, lawsuit in which the same claims are being alleged. At the same time, the iFinex subsidiaries happen to be tangled in once again, another lawsuit for hiding $850 million from its investors and trying to cover its tracks by taking a loan. This last-mentioned lawsuit is with the New York Attorney General’s office.

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