The plaintiffs refuse to drop an ongoing Bitcoin class-action lawsuit against the cryptocurrency exchange Bitfinex. The case is also targeting their affiliated stable coin Tether (USDT). Accusing the exchange as well as Tether, of conducting price-manipulation on Bitcoin (BTC) markets.

A court filing dated on December 2nd stated the plaintiffs of the lawsuit have declined to amend their complaint. Their reasoning is a study conducted by John Griffin and Amin Shams which; “still concludes that USDT was being used to manipulate Bitcoin prices.” In addition, they’ve found that the market manipulations all connect to a single entity.

Last year, Griffin and Shams of the University of Texas published a paper. In their paper the made the claim that Tether was a partial cause for Bitcoin’s historic rise to heights of $20,000 in winter 2017. Their published paper stated:

“Less than 1% of hours with such heavy Tether transactions are associated with 50% of the meteoric rise in Bitcoin and 64% of other top cryptocurrencies.”

This study on Bitcoin price manipulation makes the claims that: “one large player on Bitfinex can use Tether (USTD) to purchase large amounts of Bitcoin when prices are falling and following the printing of Tether.” Allowing them to manipulate the price of Bitcoin. The plaintiffs added further that “Bitfinex executives either were aiding this scheme or knew of it.”

Response to Bitcoin price manipulation allegations

Bitfinex had issued a response in November to this paper. In their response they denied its analysis and findings on Tether`. Going as far as accusing the authors of unethical motivations.

The Bitfinex exchange stated, “To obtain publication, Griffin and Shams have released a weakened yet equally flawed version of their prior article. The revised paper is a watered-down and embarrassing walk-back of its predecessor.”

Longhash, a blockchain education platform has also released research on the subject. Their research tries to debunk the single-whale theory of the 2017 price surge. According to Longhash, they have developed a metric to measure how much Bitcoin could be purchased with the entire supply of Tether. As well as pointing out that when the ratio is higher, it becomes more likely for Tether to potentially manipulate the price in markets. The researchers continued by saying:

“This suggests that even if Tether were indeed manipulating the market, its ability to do so actually is strongest when the Bitcoin price falls. This contradicts the claim that Tether issuance drove the 2017 bull market. The supply of Tether actually failed to keep up during the height of the bull market.”

