U.S. Court Grants Class Action Status in Tether and Bitfinex Lawsuit

Highlights:

• A U.S. court grants class action status in the Tether and Bitfinex lawsuit.
• Investors claim Tether manipulated BTC and ETH prices during the 2017 bull run.
• The lawsuit seeks billions in damages over crypto market manipulation.

The U.S. federal court granted the status of a class action in the ongoing case against Tether and Bitfinex. The lawsuit centers on market manipulation claims during the 2017 crypto boom. According to investors, the companies inflated the prices of Bitcoin (BTC) and Ethereum (ETH) through issuing unbacked Tether (USDT) tokens. 

Lawsuit Accuses Price Manipulation Using USDT

Investors filed a class action lawsuit against Tether, alleging the company issued USDT tokens without a proper backing between 2017 and 2019. These tokens were reportedly used to purchase large amounts of Bitcoin and Ethereum. According to the plaintiffs, this caused artificial demand, and it pushed the price of these cryptocurrencies higher. They argue that the inflated prices caused a market bubble that later bursted, causing substantial losses to most investors.

The plaintiffs believe that the manipulated market conditions caused billions of dollars in damages. Tether and Bitfinex have, however, refuted these claims, saying that the lawsuit is based on flawed assumptions. They also claim that the trading activities and the issuance of USDT have been misunderstood.

‼️ALLEGED PRICE MANIPULATION: INVESTORS SUE TETHER AND BITFINEX

According to a TechFlow report on March 7, a New York Federal Judge has approved a class action lawsuit against @Tether and @Bitfinex.

Investors were granted class-action status in a lawsuit alleging price… pic.twitter.com/AmbTm42OZQ

— BSCN (@BSCNews) March 7, 2026

Court Divides Plaintiffs into Two Groups

The court granted the class action status but separated the plaintiffs into two distinct groups. One of them is the group of investors who bought the cryptocurrencies in the spot market. The second group consists of traders who were involved in crypto futures markets. By so doing, the court aims to control the case in a more effective manner.

The decision of the court does not show whether both Tether and Bitfinex violated the law. However, it does not dismiss the case, and the evidence of both parties will be presented in the next steps. The lawyers will have up to March 9 to present their proposals.

What’s Next for Tether and Bitfinex in Court?

This ruling marks a significant milestone in one of the most prolonged legal battles in the crypto industry. Started in 2019, the case has undergone several legal challenges. Several claims have been dismissed, while others have survived. The class action certification will see thousands of investors join the case, which would significantly increase the financial exposure of Tether and Bitfinex.

The court will now review expert testimony and redacted documents regarding the case. Both parties will keep on collecting and bringing evidence forward. Moreover, the next steps involving the potential appeals will soon be determined.

Meanwhile, this lawsuit is not the first time that Tether and Bitfinex have come under investigation. The Celsius lawsuit received court approval to proceed in 2025 after Tether’s key objections were denied. Celsius sued Tether for breach of contract and fraud, claiming that Tether allegedly sold Bitcoin too early, resulting in billions of losses.

Binance, another crypto exchange, rejected allegations that it secretly obtained more than 60,000 Bitcoin through its client risk hedging activities during the 2020 market crash. The CEO of Binance, Changpeng Zhao, ruled these rumors as fake news and strongly denied that the exchange traded on BitMEX. This denial contributes to the ongoing debates about the crypto exchange market.

4. Fake news. They just making things up randomly now. Not sure what their goal is. I feel bad for the people believing this without seeing any proof. 😂

Binance never traded on BitMex. @CryptoHayes (a friend) would know. BitMex processes withdrawals only once a day (as far as I… pic.twitter.com/qFBiyE1Lji

— CZ 🔶 BNB (@cz_binance) February 13, 2026