The price of bitcoin dived late on Tuesday night after news that two companies, Bitfinex and Tether, had been subpoenaed by the US Commodity Futures Trading Commission (CFTC).
Concerns have been swirling in the cryptocurrency market for months about the status of Tether, a cryptocurrency issued by Tether Limited. It plays a central role in the operation of many leading cryptocurrency exchanges, including Bitfinex, but there is speculation that the company behind it may not hold the dollar reserves it claims.
If this theory is true, it has the potential to crash the price of bitcoin and potentially hobble the operations of many exchanges. Here’s what you need to know: