Is Tether Responsible For Bitcoin Price Changes?

Dawid Paluch
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Tether (USDT), the most popular stablecoin, is under investigation of United States Department of Justice (DoJ). Allegations involve manipulations of the prices of cryptocurrencies. The relation between Tether, Bitfinex and Bitcoin is under scrutiny.

The infamous stablecoin had a terrible month. First, there were rumors about possible delisting of Tether. Then, we found out that the stablecoin burned 500 million of its tokens.

Possible violations of the law

According to Bloomberg’s report, the DoJ investigates a possible manipulation of the crypto market. Allegedly, Tether was used to inflate the price of Bitcoin (BTC) almost a year ago.

Bitfinex, a cryptocurrency exchange, is involved in the case. The situation for the exchange becomes even more complicated because the platform has the same managing team as the stablecoin. They also share the same CEO, Jan Ludovicus van der Velde.

Reportedly, Tether issued new tokens and most of them entered the market through Bitfinex.

So far, the department has declined any comments concerning this case. Tether and Bitfinex also remain tight-lipped about the accusations.

To date, there haven’t been any charges pressed. The DoJ examines if there have been any cases of wrongdoings recently, including spoofing (illegal practice of flooding the market with fake token orders).

The department focuses on the creation of new tokens by Tether and why new USDs entered the market via Bitfinex.

It all happens at the same time when Bitcoin reaches the lowest price in the last 14 months. Coincidence?

 

Image by Grey82 / shutterstock.com

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