fbpx
Connect with us

Bit Coin

Mark Cuban faces class action lawsuit for promoting Voyager crypto products

Published

on

Mark Cuban faces class action lawsuit for promoting Voyager crypto products

The lawsuit alleged Mark Cuban misrepresented the crypto offerings and services by Voyager and leveraged his years of experience to lure inexperienced customers into investing their life savings.

2175 Total views

73 Total shares

Mark Cuban faces class action lawsuit for promoting Voyager crypto products

Mark Cuban, the billionaire entrepreneur who has been quite active in the crypto ecosystem for the past year, is facing a class-action lawsuit over his promotions of the bankrupt crypto brokerage firm Voyager Digital.

The Moskowitz Law Firm filed a civil suit in the United States District Court in Southern Florida against Cuban for promoting Voyager’s unregulated crypto products. The lawsuit demanded a jury hearing for the case.

The lawsuit alleged Cuban also misrepresented the firm on numerous occasions, making dubious claims of it being cheaper than competitors and offering “commission-free” trading services. Cuban, along with Voyager Digital CEO Stephen Ehrlich, leveraged their years of experience to lure inexperienced customers into investing their life savings in what they called a Ponzi Scheme, the lawsuit alleges

An excerpt from the lawsuit read:

“Cuban and Ehrlich, went to great lengths to use their experience as investors to dupe millions of Americans into investing—in many cases, their life savings—into the Deceptive Voyager Platform and purchasing Voyager Earn Program Accounts (‘EPAs’), which are unregistered securities.”

The lawsuit further alleged that Cuban continued to hype Voyager’s products and push retail investors to invest in it despite knowing it. Cuban went on record calling the Voyager platform “as close to risk-free as you’re gonna get in the crypto.” The lawsuit read:

“Voyager Platform relied on Cuban’s and the Dallas Maverick’s vocal support and Cuban’s monetary investment in order to continue to sustain itself until its implosion and Voyager’s subsequent bankruptcy.”

Voyager was one of many crypto lenders to Three Arrows Capital (3AC) that went bust after laters insolvency. The crypto lending firm paused trading activity and withdrawals on July 1 and eventually filed for chapter 11 bankruptcy on July 5. Currently, over 3.5 million American customers have nearly 5 billion dollars in cryptocurrency assets on the platform frozen.

Related: Voyager Digital reportedly had deep ties with SBF-owned Alameda Research

Voyager was cleared to return $270 million in customer funds held at the Metropolitan Commercial Bank (MCB) by the judge presiding over its bankruptcy proceedings in New York. A day later, the lending firm announced that clients with U.S. dollars in their accounts could withdraw up to $100,000 in a 24-hour period starting as early as Aug. 11, with the funds received in 5–10 business days.

Go to Source

Bit Coin

Grayscale Launches New Investment Product While Bitcoin Trust Crashes to 35%

Published

on

Grayscale Launches New Investment Product While Bitcoin Trust Crashes to 35%

Grayscale Investments is offering investors an opportunity to invest in Bitcoin mining hardware in the bear market.

The new investment opportunity, called the Grayscale Digital Infrastructure Opportunities LLC (GDIO), is now open to qualified individual and institutional investors, even as the asset manager allows ETF-related court proceedings to run their course.

Grayscale putting capital to work

Grayscale will use investor capital from the GDIO to buy mining hardware for a minimum of three years. It will use the hardware to mine and subsequently sell bitcoin. Mining is the energy-intensive process undertaken by a computer network to create a new transaction block and verify it. The node in the network that creates the block is known as a miner. A miner is rewarded in bitcoin for his effort, which typically requires large amounts of cheap electricity and computing power.

Part of the proceeds Grayscale will earn from its efforts will be paid out quarterly to GDIO investors.

“Grayscale’s unique position at the center of the crypto ecosystem enables us to create offerings that allow investors to put capital to work through differing market cycles,” stated Michael Sonnenshein, Grayscale’s chief executive.

GDIO represents another way the company has sought to provide investors with exposure to bitcoin without directly holding the asset.

Investors can also purchase shares from its GBTC trust and gain exposure to bitcoin through Grayscale’s legally regulated business in the U.S.

But Grayscale has a problem. Because investors cannot redeem shares in the trust for bitcoin, the price per share has dropped drastically, trading at a discount of 35% to its Net Asset Value. 

At the close of the trading day on Oct. 5, shares were trading at a shade over $12, despite being backed by $18.45 worth of bitcoin.

To mitigate this discount, Grayscale has pursued the conversion of GBTC into a spot bitcoin exchange-traded fund, which has so far been unsuccessful. The U.S. Securities and Exchange Commission denied the company’s latest application in June 2022, prompting Grayscale to pursue legal action against the federal agency. 

Nic Carter of Castle Island Ventures, a venture capital firm focused on early-stage public blockchain startups, said that Grayscale could wind down the ETF:

watching the GBTC discount. looks like ATL at -35%. on top of discounted spot BTC. paths to breaking open the piggy bank: SEC can approve ETF conversion, or Grayscale can wind down the trust themselves if they so choose.

— nic carter (@nic__carter) June 17, 2022

The SEC maintains that spot bitcoin ETFs are prone to underlying market manipulation.

Grayscale undeterred by SEC rejection

Despite consistent resistance from U.S. regulators, Grayscale launched its first European ETF in May 2022, which tracks the Bloomberg Grayscale Future of Finance Index, offering customers exposure to institutions at the crossroads of finance, technology, and cryptocurrencies.

Grayscale raised investors’ eyebrows recently when it announced that it had applied with the SEC to distribute 3 million ETHPoW tokens that were distributed to all Ethereum (ETH) holders after the controversial proof-of-work fork went live. 

At the time, Grayscale said it was seeking the rights to sell the tokens and pay out shareholders. 

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.

Go to Source

Continue Reading

Bit Coin

Colorado is accepting crypto for tax payments — it could be a mess or a shining example

Published

on

Colorado is accepting crypto for tax payments —  it could be a mess or a shining example

Colorado is now accepting crypto for tax payments — but if you choose to use that option, it could change the amount you owe…
Go to Source

Continue Reading

Bit Coin

BNB Chain confirms BSC halt due to ‘potential exploit’

Published

on

BNB Chain confirms BSC halt due to ‘potential exploit’

Rumors of a significant hack on the BNB Chain were confirmed by the blockchain’s team, with all deposits and withdrawals suspended on the network…
Go to Source

Continue Reading
Home | Latest News | Cryptocurrency | Bit Coin | Mark Cuban faces class action lawsuit for promoting Voyager crypto products
a

Market

Trending