The Conclusion of the Bitfinex and Tether Lawsuit
The class action lawsuit against crypto exchange Bitfinex and its sister company, the USDT stablecoin issuer Tether, has come to an end, with the plaintiff choosing not to appeal the judgment. Stablecoins have been a subject of public and regulatory scrutiny due to issues such as backing, maintaining the peg, and illicit transfers.
Tether Dismisses Class Action Lawsuit
Tether has announced that the class action lawsuit filed by Shawn Dolifka and Matthew Anderson has been completely dismissed. This decision came after Dolifka chose not to appeal the judgment of Chief Judge Laura Taylor Swain. The lawsuit, filed in 2021, alleged that USDT was not backed one to one by the US dollar.
Tether’s Response
Tether believes that the class action lawsuit was meritless and stated that Dolifka’s decision to forego his appeal rights was the correct decision. The company maintains that his claims were entirely without merit. Despite this legal victory, Tether has faced heavy penalties from regulators in the past.
In 2021, Tether signed an $18.5 million settlement with the New York Attorney General over USDT’s backing. Additionally, in October 2021, the US Commodity Futures Trading Commission (CFTC) imposed a $41 million fine against Tether for the same matter.
The Future of USDT
Despite these controversies, new CEO Paolo Ardoino has declared that Tether will begin publishing real-time data on its reserves in 2024. This move may help address concerns about USDT’s backing. Despite legal challenges, USDT’s circulation has increased compared to its largest rival, USDC.
Hot Take: The Future of Tether
Despite facing legal challenges and regulatory actions in the past, Tether remains committed to addressing concerns about its backing and maintaining its position as a leading stablecoin in the cryptocurrency market. With a new CEO at the helm and plans to provide real-time data on reserves in 2024, Tether is taking steps to build trust and transparency within the industry.
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