Tether has hit back at renewed claims that it helped manipulate the price of Bitcoin during the historic run to $20,000 in 2017. The company behind the USDT stablecoin were forced to respond after two academics renewed their attack on the company and Bitfinex, saying they, along with a single ‘whale’, manipulated the market upwards throughout 2017, something Tether calls a “clumsy assertion”.
Tether Response to Flawed Paper by Griffin and Shamshttps://t.co/5DymkhOOHX
— Tether (@Tether_to) November 7, 2019
Tether Criticizes “Flawed” Argument
John M. Griffin and Amin Shams updated their explosive 2018 paper last week, backing up their original claim that the Bitcoin price was artificially increased by the printing of billions of dollars of USDT tokens, adding a further assertion that one single Bitfinex account holder was responsible for the BTC buying on the exchange. Tether has railed against these claims however, stating in a blog post that Griffin and Shams have “released a weakened yet equally flawed version of their prior article”, adding that “The purported conclusions reached by the authors are built on a house of cards” given that they are based on an “incomplete dataset”. The strongly-worded attack also criticizes the pair’s “false bravado in recent aggressive statements to the media” and claims they have “a fundamental lack of understanding of the cryptocurrency marketplace and the demand that drives Tether token purchases.”
Tether Not Alone
Tether’s reasoning was an echo of some early criticism within the crypto community, most notably from writer Larry Cermak who also hit out at the “errors and fundamental misunderstandings” within the paper, adding that “There is still no proof that there was market manipulation.” Tether clearly appreciates the fact that others in the space share their argument, stating that “sophisticated and experienced traders in the ecosystem appear to fully understand” that Tether is just one piece of the whole crypto puzzle and that it alone is too small to be responsible for Bitcoin’s run in 2020. However, others have claimed that manipulation is rife within cryptocurrency, most notably Nouriel Roubini who has called the ecosystem a “cesspool”.