Block.one ICO damages ‘far beyond’ $22M, ENF founder says
The latest legal action against Block.one (B1), the creator and original seller of EOS (EOS), could potentially help plaintiffs get higher compensation, according to EOS Network Foundation (ENF) founder and CEO Yves La Rose.
On July 25, La Rose officially announced that ENF is preparing a lawsuit against Block.one for its failure to follow through on its $1-billion following its $4.1-billion raise in 2018.
The CEO argued that Block.one’s broken promises to invest $1 billion caused major issues for the EOS community and promised to hold the firm accountable.
As many investors have already been part of another class action against Block.one, a number of those might need to opt out of their current lawsuits, La Rose said.
“They would do that if they aren’t satisfied with the current settlement offer and believe their interests are better suited by opting out, which is a common practice,” the ENF founder told Cointelegraph.
La Rose added that opting out of an old class lawsuit could result in “obtaining a higher payout,” but it could also result in receiving nothing.
“There are no guarantees, which is why this is a personal choice they need to make,” the ENF founder noted, reiterating that the firm recommends any person consult their own legal counsel to determine which path is best for them.
La Rose also emphasized that the amount of settlement in the current class action might not be enough for those who were affected. He stated:
“Not everyone is covered in the current class, and so this new contemplated action also widens the pool of potential participants. Also, the measly $22 million that Block.one offered is pathetic. The damages caused on a $4-billion raise are far beyond what is being offered in reparations.”
Block.one’s EOS initial coin offering (ICO) became one of the largest crowdfunding raises in history, raising as much as $4.1 billion by June 2018 and outstripping Telegram’s $1.7 billion ICO.
By the end of its year-long crowdsale, EOS was trading at around $12, or around 44% down from its peak price recorded in April 2018. The cryptocurrency then experienced a couple of ups and downs, eventually plummeting all the way down below $1. At the time of writing, EOS is trading at $0.74, down roughly 30% over the past year.
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Despite a massive decline, EOS is still one of the biggest cryptocurrencies by market capitalization, which amounts to $827 million at the time of writing. That makes the EOS cryptocurrency the 54th largest coin by market value, according to CoinGecko.
In 2019, Block.one agreed to pay a $24-million civil fine to settle with the United States Securities and Exchange Commission over charges that it held an unregistered ICO. A few months later, disgruntled investors started a class-action lawsuit against Block.one, arguing that the firm deceived tokenholders about its financial history, operations and budget, as well as executive compensation, material trends, risk factors and others.
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