U.S. District Court Dismisses Lawsuit Against Tether
Date: 2023-08-07 Author: Karina Ziganova Categories: CRYPTO PAYMENTS, IN WORLD
The issuer of the largest stablecoin, Tether, scored another legal victory: the US District Court dismissed a class-action lawsuit regarding USDT reserves.
On August 4, Chief Judge Laura Taylor Swain of the US District Court for the Southern District of New York ruled that the class action was dismissed.
Another victory for Tether in court
The trial began in December 2021. Matthew Anderson and Sean Doliphka made accusations based on the findings of the New York Attorney General (NYAG), the Commodity Futures Trading Commission (CFTC), and Tether's statements on the composition of USDT reserves.
“USDT tokens in circulation were not backed as claimed by Tether,” the complaint reads. “Sometimes the defendants had no reserves at all. In addition, the reserves did not contain US dollars but were a mixture of other assets such as overcollateralized loans and other undisclosed commercial paper.”
The court ruled that the plaintiffs had not made "plausible claims of damages" and failed to provide factual evidence that the value of the USDT was not as claimed.
Tether and Bitfinex CTO Paolo Ardoino shared the news on Twitter, reaffirming both companies' commitment to protecting the interests of customers and the community.
USDT holds nearly 70% of the stablecoin market
In recent ratings from an independent non-profit rating agency that evaluates stable cryptocurrencies, Tether did not perform well. USDT received a D due to lack of decentralization and governance issues.
However, the company still remains the market leader in stablecoins by a wide margin.
According to Tether's latest report, USDT's market capitalization has reached a record $83.9 billion. Thus, the coin occupies 66.7% of the stablecoin market.
Nearest competitor Tether Circle is not doing so well. Since the beginning of 2023, the supply of USDC has decreased by 41.5%. At the moment, the capitalization of the asset is $26 billion.
Algorithmic stablecoin DAI from MakerDAO, meanwhile, holds 3.2% with a capitalization of $4 billion.
