Tether has spoken out regarding claims it is linked to Bitcoin’s price surge in 2017. A recently published study indicated that a lone whale account instigated events that led to the coin’s bull run.
Griffin and Shams Research Flawed
In an official statement posted on the company’s website, Tether slammed the study’s findings and claimed authors John M. Griffin and Amin Shams research was flawed. The company also called out the two for having no understanding of how the crypto market work and accused them of having less than ethical motives for writing the paper.
The issue started when Griffin and Shams published an updated version of their previous analysis. The original paper, which was part of a research paper released in June 2018, alleged that market manipulation was behind the BTC bull run in 2017. At the time, BTC price hit a high of $20,000.
This time around, the authors are claiming that a sole market whale account utilized Tether tokens to manipulate half of the Bitcoin (BTC) price surge in 2017. The latest study hasn’t been published yet, but Bloomberg reported on its main findings on Nov. 4. The paper is reportedly expected to appear in the Journal of Finance.
Tether’s official statement refutes those claims. According to the company, Griffin and Sham’s latest piece was a “watered-down and embarrassing walk-back” of its original analysis. It also noted that the revised study had the same mistakes in methodology as the previous one.
House of Cards
Tether also called the authors’ alleged conclusions as built on a “house of cards.” It highlighted the marked absence of a complete dataset and underlined the researchers’ admission that they don’t have data on transactions times.
Bitfinex’ sister company also pointed out that the paper had numerous mistakes. They gave as an example the authors’ acknowledgement that they were unsure of how the capital was directed through different exchanges. According to Tether, this disturbing lack of data indicates research can’t establish an exact timeline of events that supposedly led to the BTC manipulation.
Tether also accused the two academics of not having enough knowledge regarding the cryptocurrency market and the factors that influence token purchases.
Tether said the company and its affiliates never use issuances or Tether tokens to control token pricing or the crypto market. It also claimed that all Tether coins are completely backed by reserves. It noted that the tokens are only issued based on market demand, and not to control the pricing of cryptocurrency assets.