Bloomberg Law
Oct. 7, 2019, 6:00 PM

Backers of Crypto Coin Tether Sued Over Market Manipulation

Olga Kharif
Olga Kharif
Bloomberg News

A class-action complaint accuses the companies behind the stablecoin Tether of “propping and popping the largest bubble in history,” leading to disappearance of $265 billion in cryptocurrency wealth.

Filed in the U.S. District Court for the Southern District of New York on Sunday, Oct. 6, on behalf of a handful of investors, the complaint accuses the issuer of the stablecoin -- a category of tokens that seek to avoid price fluctuations, often through pegs or reserves -- of manipulating Bitcoin prices.

Because Tether’s owners also own the Bitfinex exchange, the suit alleged, they can execute effectively unbacked Bitcoin buy orders ...