Judge Advances Cryptocurrency Class Action


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"data-medium-file =" https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?fit=300%2C210&ssl=1 "large data file = "https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?fit=1000%2C699&ssl=1" class = "size-medium wp-image -428421 alignleft "src =" https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?resize=300%2C210 "alt =" "width =" 300 "height =" 210 "srcset =" https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?resize=300%2C210&ssl=1 300w, https : //i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg? resize = 768% 2C537 & ssl = 1 768w, https://i2.wp.com/www. courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?resize=130%2C90&ssl=1 130w, https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018 /08/Cryptocurrency.jpg?resize=24%2C17&ssl=1 24w, https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?res ize = 36 % 2C25 & ssl = 1 36w, https://i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?resize=48%2C34&ssl=1 48w, https: / /i2.wp.com/www.courthousenews.com/wp-content/uploads/2018/08/Cryptocurrency.jpg?w=1000&ssl=1 1000w "sizes =" (max-width: 300px) 100vw, 300px "data – recalc-dims = "1" /> SAN FRANCISCO (CN) – In a case concerning new issues related to the fact that investments in digital currency are subject to US securities laws, a federal judge has Collective action against a husband and wife team who raised $ 232 million for a new cryptocurrency.

United States The District Court Richard Seeborg has refused to dismiss plaintiff of Arman Anvari against the virtual currency creators of Tezos Arthur and Kathleen Brietman, their company Dynamic Ledger Solutions (DLS) and Tezos Stiftung, the Swiss foundation they set up to oversee a & Initial supply of coins in July 2017.

After calling Tezos a "solution" to the shortcomings of other digital currencies, the Breitmans have organized a "crowdsale" in 2017 to help finance the creation of a new blockchain, or secure network for the exchange of Tezos tokens.

class shares were archived and subsequently consolidated after an internal dispute that delayed the launch of the new Tezos blockchain last fall.

The defendants state that the initial money supply was only a fundraiser, not an investment program and that they did not have to provide Token Tezos to the contributors. The plaintiffs claim that the contributions were investments, which means that the defendants had to register with the US Securities and Exchange Commission before accepting money.

The Breitmans argued that they could not be held responsible for the sale of unregistered securities because a separate Swiss entity, Tezos Sitfung, oversaw the initial offer of coins. Seeborg rejected that discussion, finding the couple and the foundation "deeply intertwined, if not functionally interchangeable" throughout the process.

Seeborg found allegations that the Breitmans developed websites and applications used for the initial offer of coins and promoted fundraising on online forums, adequately support a conclusion that their involvement has risen well above the level of "collateral participation".

The judge also rejected claims that the lawsuit seeks to enforce US securities laws to conduct the overseas laws. Although a Swiss foundation oversaw the initial supply of coins, Seeborg discovered that the development of the Breitmans key elements for the project took place in California and that offer marketing was aimed almost exclusively at US investors. .

In rejecting the extraterritorial argument, Seeborg also noted that the plaintiff initiated his investment transaction on a website hosted on a server in Arizona and that his contribution from the digital currency Ethereum was " validated by a network of global "nodes" grouped more densely in the United States than any other country. "

Seeborg fired some defendants with permission to amend, including American venture capitalist Tim Draper. Draper has invested 1.5 million dollars in DLS, obtaining a seat on the board of directors and a 10 percent stake in the company and publicly publicizing Tezos. But Seeborg found out that Anvari could not prove that he relied on everything Draper said when he chose to invest in Tezos.

In addition, Seeborg fired the Bitcoin Suisse company as a defendant, finding its role in providing virtual currency conversion services for Tezos investors "It does not seem to be a key player in this action."

Anvari is represented by Hung Ta of New York, who has not returned a request for comment by press time.

Breitmans are represented by Brian Klein of Baker Marquart in Los Angeles, who said he believes his customers eventually prevail.

"Although we are understandably disappointed by today's ruling, this was not a decision on the merits of the case," Klein said. "We believe that Kathleen, Arthur and DLS will be fully confirmed in the end, they have not violated any law and Tezos's contributors have not been damaged."

In June, Tezos presented a trial version of his blockchain, or exchange system digital for Tezos tokens, after months of delay.

Starting Tuesday afternoon, a single Tezos unit was valued at $ 1.70, down 4.8 percent and dramatically lower than its historic high of $ 10.39 in mid-December 2017.

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