Earlier today, Bloomberg reported that the U.S. Commodity Futures Trading Commission recently sent subpoenas to one of the world’s largest cryptocurrency exchanges, Bitfinex, as well as Tether, a company that has been issuing a widely controversial token, USDT, which is supposedly pegged to the U.S. dollar.

The market reacted almost immediately to the news, causing Bitcoin to drop under $10,000. However, Bloomberg later updated their article to state that the subpoenas were issued on December 6, 2017, which resulted in a slight market recovery. Bitfinex and Tether stated in a statement to Bloomberg that, “We routinely receive legal process from law enforcement agents and regulators conducting investigations... it is our policy not to comment on any such requests.”

Tether has been criticized by many in the community with the belief that the 2.9 billion USDT tokens it has issued are not backed by U.S. dollar reserves as they have claimed. They previously hired Friedman LLP to perform an audit on their historical balance sheets, but recently announced on January 27th that they have dissolved the relationship with Friedman LLP, which only adds fuel to the speculation.

A few influential members of the crypto community expressed their opinion regarding the Tether situation:

1/ With respect to the Tether situation, it's expected for CFTC to subpoena Bitfinex to investigate if there are any wrongdoings. The fact that the subpoena is in December 2017 and they have still continued issuing USDT is good news.

USDT is just like any other altcoin.

— Charlie Lee [LTC] (@SatoshiLite) January 30, 2018

Irony: the US Gov subpoena-ing a private company about the realness of their reserves. #Bitfinex #Bitcoin #Tether

— Erik Voorhees (@ErikVoorhees) January 30, 2018

I don’t understand why Bitcoin is tanking right now. If you hold any of the $2bn in Tether, wouldn’t you be dumping Tether and buying BTC/BCH/ETH instead? Any theories?

— Vinny Lingham (@VinnyLingham) January 30, 2018

It is safe to say that everyone wants to see a conclusion to the FUD surrounding Tether. It is either legitimate or fraudulent, and we hope to get a definitive answer sooner rather than later.