Class Action Lawsuit Against Block.One Over Unregistered EOS ICO


Investors of the EOS token sale has filed a class-action lawsuit against Block.one. The plaintiffs allege that the company provided false statements to investors and made up $200 million of the EOS ICO, in violation of securities law.

19 May, 2020, | AtoZ Markets – Crypto Assets Opportunity Fund LLC and Johnny Hong filed a class-action lawsuit against Block.One in the US District Court. Block.One, its CEO Brendan Blumer, CTO Daniel Larimer, former Block.one partner Ian Grigg and former advisor Brock Pierce are all named as defendants.

Over $200 Million Illegally Raised During EOS ICO

According to the complaint, more and more investors are seeking refund EOS token sale. However, it was the record-breaking EOS token sale. It brought over $4 billion in cryptocurrency. But the plaintiffs allege that over $200 million of that money illegally raised. The plaintiffs also allege that Block.one provided investors false and misleading information about EOS token sale.

“To drive the demand for and increase profit from the sales of EOS Securities, Defendants further violated the securities laws by making materially false and misleading statements about EOS. It artificially inflated the prices for the EOS Securities and damaged unsuspecting investors,” read the complaint.

Block.one did not register its EOS token sale in the US as security. Therefore it relied on its measures to completely ignore US investors as a means of complying with the US regulator. However, some US investors did participate in the ICO, and Block.one ended up meeting the SEC anyway.

In September, Block.one reached an agreement with the SEC for $ 24 million. Moreover, an EOS wallet, EOS Ecosystem App has allegedly shut down and disappeared with over $52 million user funds in last month. However, the stolen funds would be hard to cash out because EOS is easy to track.

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