It was in way back in May 2018 when the US Department of Justice began a criminal probe into whether there was involvement of traders in manipulating the prices of Bitcoin last December when it reached the all-time highs. But looks like now all eyes are on Tether and its use by traders to rake up prices.
Is Tether a key element that skyrocketed the prices?
According to the recent report published by Bloomberg, the attorneys at the U.S. Justice Department, that were probing the case of illicit trading activities related to driving the prices of Bitcoin to USD 20000, are currently focusing on Tethers and Bitfinex’s involvement in this manipulation. According to the reports, there seems to be a suspicion that Tether was used to rake up the bitcoin prices last year. And as Bitfinex has the same management team as Tether Ltd. And since most coins were first released via Bitfinex it is considered the Hong Kong-based exchange had equal involvement.
This is the not the first time Tether’s and Bitfinex’s name has been linked to the bitcoin price manipulation. Both, Tether Ltd. and Bitfinex, had received subpoenas in January from the U.S. Commodity Futures Trading Commission. It is also believed that the Justice Department and CFTC are coordinating their examinations.
There is still no official comments or exact clarity as to the government officials are an only investigating activity that occurred on Bitfinex or if any of the exchange executives too were involved in any kind of wrongdoing.
In June this year, a research report by a finance professor at Texas University had evaluated the role of Tether in the inflated prices of bitcoin and other cryptocurrencies last year. By using algorithms, the research found a significant association of Tether in the price spike.
Well, we will have to wait and watch what would be the outcome of this probe but its somewhat looks difficult for Tether and Bitfinex to come out clean from this.
What is your view on Tether and its illicit role in Bitcoin price manipulation? Do let us know your views on the same