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Tether and Bitfinex CTO to Testify in Market Manipulation Suit

Kelvin Munene Murithi

Paolo Ardoino, the Chief Technology Officer of Tether and Bitfinex, is set to testify this week in a class-action lawsuit. The lawsuit has embroiled both firms since 2019. Moreover, a New York judge denied the request for delaying Ardoino’s deposition to October, leaving the defense scrambling for time.

Initially filed in 2019 by LeboBTC co-founder Jason Leibowitz, the lawsuit alleges financial misconduct against Bitfinex and Tether. Consequently, the plaintiff class is seeking over $1.4 trillion in damages. The accusations range from bank fraud to money laundering. Tether, however, has firmly denied any wrongdoing.

Tensions Rise Over the Scope of Ardoino’s Testimony

Besides financial misconduct, the lawsuit is probing into the sufficiency of Tether’s reserves. Previously, both parties clashed over what topics Ardoino’s deposition could cover. These include alleged gaps in trading records, the companies’ loan-making policies, and the wallets that held Tether’s reserves. Hence, the judge’s latest order specifies that Arduino must speak on undisputed topics only.

Significantly, Tether dominates the stablecoin market with a 64% share. Its current market capitalization sits at a whopping $83.6 billion. However, regulatory agencies in the U.S. have had concerns about Tether’s reserves. Last year, Tether and Bitfinex settled an investigation with the New York State Attorney General, resulting in a ban on their business activities in New York.

Court Cites Defendants’ Actions for Lack of Preparation

Judge Katherine Polk Failla had sharp words for the defendants, stating that any lack of preparation was “largely of their own doing.” Additionally, she expressed concerns about the lawsuit’s pace. She clarified that adding one more topic since August shouldn’t significantly burden the defendants.

Consequently, market participants watch closely as Tether and Bitfinex navigate the convoluted legal landscape. What comes out of this week’s deposition could significantly impact these firms and the broader crypto market.

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Kelvin is a distinguished writer specializing in crypto and finance, backed by a Bachelor’s in Actuarial Science. Recognized for incisive analysis and insightful content, he has an adept command of English and excels at thorough research and timely delivery.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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