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Bitfinex and Tether Receive Another Class Action Lawsuit in US Courts

The operators of the cryptocurrency exchange Bitfinex and the stablecoin Tether have notified users that they were hit with another class action lawsuit in U.S. courts over market manipulation allegations that the companies are trying to frame as mercenary and baseless.

Also Read: Bitfinex Claims to Be Victim of Fraud After Crypto Capital President Arrested

Tether Operators Face New Complaint in US

Bitfinex has informed users that a class action complaint was filed against the exchange and Tether in the U.S. District Court for the Western District of Washington on November 22, 2019. They say that the claims against them are without merit, and they strongly contest the “bogus research” that is used to support them. The two companies also call it a “copycat lawsuit” to the one filed against them in the U.S. District Court for the Southern District of New York on October 6, 2019. As we reported at the time, that first suit accused them of creating the “largest bubble in human history,” and with causing well over a trillion dollars in damages.

“As we predicted last month, mercenary lawyers continue to try to use Bitfinex and Tether to obtain a payday,” the two companies said. “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. Once they are, Bitfinex and Tether will fully evaluate their legal options against those bringing and promoting the baseless claims.”

Bitfinex and Tether Receive Another Class Action Lawsuit in US Courts

The companies also tried to get the support of the whole crypto community behind them by 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. Meritless lawsuits like these are a continuing affront to the efforts and dedication of Bitfinex’s customers and all participants in the digital currency ecosystem. Our fight is the community’s fight.”

Fraud and Market Manipulation Accusations

The New York lawsuit accused the operators of Tether and Bitfinex of managing a sophisticated scheme to defraud investors, manipulate markets, and conceal illicit proceeds. According to the complaint, they commingled their corporate identities and customer funds while concealing their extensive cooperation. And they also allegedly lied to investors saying that the number of USDT tokens in circulation will always be the same as the amount of dollars in the companies’ bank accounts. This allegedly gave them the power to fake market demand for cryptocurrencies by just printing more USDT and using it to buy coins.

Bitfinex and Tether Receive Another Class Action Lawsuit in US Courts

The USDT operators are already well used to facing accusations that they are manipulating the cryptocurrency market. Over the years many critics have made similar claims about the issuance of the stablecoin and its correlation to price rises. Despite this, it remains the top dollar-pegged digital instrument.

The biggest risk that Bitfinex and Tether face is likely to be action by U.S. authorities. Earlier this year the New York Attorney General’s (NYAG) office revealed that it has already taken aim at the stablecoin. It accused the companies of a cover-up to hide the loss of $850 million dollars of co-mingled client and corporate funds. The American investigators also demanded that Bitfinex turn over documents tied to Tether.

What do you think about the new class action lawsuit against Bitfinex and Tether? Share your thoughts in the comments section below.

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Avi Mizrahi

Avi Mizrahi is an economist and entrepreneur who has been covering Bitcoin as a journalist since 2013. He has spoken about the promise of cryptocurrency and blockchain technology at numerous financial conferences around the world, from London to Hong-Kong.

Avi Mizrahi , 2019-11-27 23:30:01 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

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Nick Chong , 2019-11-10 12:00:38

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