Published Nov 17, 2023 04:39PM ET
NEW YORK – The controversial class-action lawsuit against cryptocurrency firms Tether and Bitfinex has reached a conclusion without an appeal from the plaintiffs. The legal battle, which has been ongoing since 2019, was centered around accusations of financial misconduct and market manipulation, with claims that the companies’ actions caused over $1.4 trillion in damages.
The lawsuit was initially brought forth by Jason Leibowitz, Co-founder and CEO, accusing Tether and its affiliate Bitfinex, alongside Crypto Capital, of bank fraud and money laundering. However, these allegations were dismissed by U.S. District Court Chief Judge Laura Taylor Swain earlier in August. On Friday, plaintiff Shawn Dolifka agreed to cease his appeal following the dismissal, with his legal representation recognizing the claims as unsubstantiated and opting not to pursue further litigation against Tether.
This legal outcome follows a previous order in 2022 by Judge Katherine Polk Failla, which compelled Tether and Bitfinex to provide financial records related to the reserve backing of USDT, Tether’s digital currency pegged to the U.S. dollar. The order was part of a separate accusation that the companies inflated the market, an allegation Bitfinex labeled “frivolous.”
In response to the initial lawsuit, Tether published a blog post condemning the claims as meritless and expressing their position against what they saw as opportunistic litigation. The company referred to the accusations as part of a “sophisticated scheme” that contributed to what was described as “the biggest bubble in human history.”
The resolution of this case marks a significant moment for Tether and Bitfinex, as it clears a cloud of legal uncertainty that had been hanging over the companies for years. With the plaintiffs withdrawing their appeal, Tether and Bitfinex can now move forward without this particular legal challenge impeding their operations.
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Written By: Investing.com