The Chief Technology Officer of Tether, the largest stablecoin issuer, and Bitfinex cryptocurrency exchange, Paolo Ardoino, will testify in a collective lawsuit that has been on both companies’ agenda since 2019. Although the defense requested a postponement of the statement to October, New York judge Katherine Polk Failla rejected this request.
Special Request for Ardoino’s Testimony from the Presiding Judge
The lawsuit, initially filed in 2019 by Jason Leibowitz, co-founder of LeboBTC, has turned into a collective lawsuit over time. The lawsuit alleges financial manipulation by Bitfinex and Tether. The allegations made by the plaintiff community range from bank fraud to money laundering, questioning the adequacy of Tether’s reserves. Although the plaintiff community is demanding compensation of over $1.4 trillion from Tether and Bitfinex, Tether has firmly denied all allegations raised so far.
Furthermore, the scope of Ardoino’s statement has been a subject of debate in the past. Both parties have failed to reach an agreement on this matter. The disagreement includes alleged gaps in trading records, lending policies of both companies, and the wallets holding Tether’s reserves. The presiding judge requested that Ardoino only testify on non-disputed matters, citing this disagreement as the reason.
Tether currently dominates the stablecoin market with a 64% share and has a market value of $83.6 billion. However, regulatory authorities in the US have concerns about Tether’s reserves. Last year, the New York State Attorney General launched an investigation into Tether and Bitfinex, and following the completion of the investigation, Tether’s commercial activities in New York were banned.
Court Considers the Defense Request as “Lack of Preparation”
Judge Katherine Polk Failla rejected the defense’s request to postpone the statement to October. Failla stated that the lack of preparation, which was cited as the reason for the postponement to October, largely originated from the defense, expressing her concerns about the pace of the lawsuit.
Market participants closely follow how Tether and Bitfinex navigate the complex legal environment. The outcomes of the testimonies to be given in court this week will be closely monitored, as they can have a significant impact on cryptocurrency companies and the overall cryptocurrency market.
