In the ongoing court battle over the identity of Bitcoin’s creator, Craig Wright continues to face accusations that he forged documents to support his claim of being Satoshi Nakamoto. However, Wright maintains the documents were faked by others to frame him. Wright vs. COPA: ‘Industrial Scale’ Forgery Accusation Clouds Craig Wright’s Claim as Bitcoin’s Founder […]
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NBA Faces Class Action Lawsuit Over Voyager Digital Promotion
A class action lawsuit has been filed against the National Basketball Association (NBA), accusing the league of gross negligence through its marketing agreements with the now-bankrupt crypto exchange Voyager Digital Holdings, leading to investor losses of over .2 billion. NBA Hit With Class Action Lawsuit Over Alleged Negligent Crypto Promotions The NBA is embroiled in […]
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Genesis Settles SEC Lawsuit for $21 Million Over Unregistered Securities
Facing charges from the SEC over its crypto lending practices, Genesis has agreed to a million settlement. This move aims to close a chapter of legal challenges following the company’s bankruptcy filing last year amid a wider crypto market collapse.
Genesis Strikes Million Deal With SEC to Resolve Lawsuit
Genesis Global Holdco has agreed to a million settlement to resolve a lawsuit related to its crypto lending practices. Genesis, a subsidiary of Digital Currency Group, faced allegations from the SEC concerning the unregistered offer and sale of securities through its Gemini Earn program.
The proposed settlement, disclosed in a filing with the U.S. Bankruptcy Court for the Southern District of New York, is set to be a crucial step towards resolving the civil actions initiated by the SEC. This move comes after a tumultuous period for Genesis, which filed for bankruptcy in January 2023 following the collapse of major crypto entities such as Three Arrows Capital and the FTX exchange.
Genesis’s agreement to pay million is part of a broader strategy to navigate through its financial and legal predicaments, aiming to stabilize its operations amidst the uncertainties of the crypto market. The settlement is intended to mitigate the costs and uncertainties associated with prolonged litigation.
Genesis’s legal and regulatory woes extend beyond the SEC settlement. The firm, along with Genesis Global Trading, recently reached a settlement with the New York State Department of Financial Services (NYDFS), involving an million fine and the relinquishment of its Bitlicense, reflecting serious compliance failures within the company’s operations.
These developments come at a time when Genesis is entangled in additional legal disputes, including allegations of defrauding investors through the Gemini Earn program, as well as internal conflicts complicating its path to recovery.
Despite these challenges, Genesis’s efforts to settle outstanding legal issues appear to signal a commitment to restructuring and stabilizing its operations.
Will Genesis be able to settle all of its legal troubles and eventually resume business operations? Share your thoughts and opinions about this subject in the comments section below.
SEC Moves to Dismiss Lawsuit Against Crypto Company Debt Box, Citing Inaccuracies in Court
The SEC has decided to abandon its lawsuit against Debt Box, a crypto company previously accused of defrauding investors of millions. This decision follows the SEC’s acknowledgment of presenting misleading information in court, a revelation that undermines the agency’s case and credibility.
Inaccuracies in Court Lead SEC to Drop Fraud Case Against Crypto Firm Debt Box
The U.S. Securities and Exchange Commission (SEC) has requested to dismiss its lawsuit against crypto startup Debt Box. The decision comes after the SEC admitted to making inaccurate statements in court.
The lawsuit, initially filed against Digital Licensing Inc., which does business as Debt Box, accused the company of defrauding investors of at least million. The SEC claimed that Debt Box offered “node licenses” for mining cryptocurrencies that were never actually mined. This action was part of a broader crackdown by the SEC on cryptocurrency firms, under the leadership of Chair Gary Gensler who has repeatedly stated that most cryptocurrencies are securities.
However, the case took a turn when the SEC’s attorneys acknowledged that they had fallen short of the court’s expectations for accuracy and candor. This admission came after U.S. District Court Judge Robert Shelby in Utah criticized the SEC lawyers and demanded explanations for what he termed “false or misleading” statements.
The SEC had previously asserted that Debt Box was attempting to transfer assets overseas to evade U.S. jurisdiction, a claim that Judge Shelby found to be misrepresented. Judge Shelby gave the SEC a “show cause order,” which basically meant the SEC had to give a good reason or explanation for its actions.
In response to the court’s order to show cause, the SEC filed a statement on Jan. 30, stating,
While the Commission recognizes that its attorneys should have been more forthcoming with the Court, sanctions are not appropriate or necessary to address those issues.
The agency expressed its intent to dismiss the lawsuit without prejudice, leaving room for the possibility of refiling the case in the future.
The SEC’s decision to seek dismissal without prejudice has raised questions in the legal and financial sectors, particularly given the agency’s aggressive stance on cryptocurrency regulation. The Debt Box legal team responded sharply to the SEC’s actions, stating, “The SEC got this case wrong. Badly wrong,” and argued that the agency should not be allowed to continue promoting a false narrative to avoid dismissal.
Despite the SEC’s admission of inaccuracies and the subsequent move to dismiss the case, the agency has declined to comment beyond its public filings.
What do you think explains the SEC’s inability to pursue this lawsuit? Share your thoughts and opinions about this subject in the comments section below.
Terraform Labs Files for Bankruptcy in US Amid SEC Lawsuit
Terraform Labs has filed for Chapter 11 bankruptcy in the U.S. amid ongoing litigation with the U.S. Securities and Exchange Commission (SEC). The company stated in its bankruptcy filing that “funds will be available for distribution to unsecured creditors.” Meanwhile, Terraform Labs co-founder Do Kwon is facing an upcoming SEC trial and extradition proceedings.
Terraform Labs Seeks US Bankruptcy Protection
Terraform Labs (TFL) filed for Chapter 11 bankruptcy protection in the United States on Sunday. The company and its co-founder Kwon Do-hyeong, aka Do Kwon, are in an ongoing litigation with the U.S. Securities and Exchange Commission (SEC) following the Terra blockchain’s implosion.
In its filing with the bankruptcy court in Delaware, Terraform Labs listed assets and liabilities in the range of 0 million-0 million. Its estimated number of creditors lies between 100 and 199. “Funds will be available for distribution to unsecured creditors,” the filing states.
The company has pledged to meet all financial obligations to employees and vendors throughout the Chapter 11 proceedings without seeking additional financing, CNBC reported, adding that Terraform Labs also plans to continue expanding its Web3 offerings. The news outlet quoted the company as saying:
The filing will allow TFL to execute on its business plan while navigating ongoing legal proceedings, including representative litigation pending in Singapore and U.S. litigation involving the Securities and Exchange Commission (SEC).
Do Kwon, charged by the SEC with defrauding investors out of billions of dollars following the collapse of luna cryptocurrency and stablecoin terrausd, will face a delayed trial. The SEC’s case against Terraform Labs and Kwon has been pushed back to April to facilitate Kwon’s extradition proceedings from Montenegro, where he remains after an arrest warrant was issued by South Korean authorities in late 2022. Separately, Daniel Shin, the other co-founder of Terraform Labs, was indicted in South Korea in April last year.
Terraform Labs CEO Chris Amani said in a statement: “We have overcome significant challenges before and, against long odds, the ecosystem survived and even grew in new ways … we look forward to the successful resolution of the outstanding legal proceedings.”
What do you think about Terraform Labs filing for bankruptcy protection in the U.S.? Let us know in the comments section below.
XRP Lawsuit: Full History, News, Schedule And Price Predictions
Few events have garnered as much attention as the ongoing lawsuit between Ripple Labs and the US Securities and Exchange Commission (SEC) – often referred to as “XRP lawsuit”. This legal battle, which has significant implications for the broader crypto market, has seen a series of twists and turns that have kept investors and industry observers on their toes. In this article, we delve into the details of the XRP lawsuit, provide the latest updates, and explore what the future might hold for XRP price.
XRP Lawsuit Overview: What Are The SEC’s Claims?
In December 2020, the US Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs, the company behind the XRP cryptocurrency, and two of its executives, Brad Garlinghouse and Christian Larsen. The SEC alleged that XRP is an unregistered security and that Ripple Labs illegally raised over .3 billion through its sale.
The SEC’s position hinges on the application of the Howey Test, a standard derived from a 1946 Supreme Court case, to determine if a transaction qualifies as an “investment contract” and therefore should be considered a security subject to SEC regulation. The SEC argues that investors in XRP expected profits primarily from the efforts of Ripple’s management and its corporate actions, classifying XRP as a security under this framework.
XRP Lawsuit: The Howey Test
The SEC’s case hinges on the Howey Test, a four-pronged test that determines whether an asset is considered a security under US law. The four prongs of the Howey Test are:
- An investment of money: The investor must have invested money in a common enterprise.
- A reasonable expectation of profits: The investor must have a reasonable expectation of profits to be derived from the investment, solely from the efforts of others.
- Participation in a common enterprise: The investor must participate in a common enterprise with the promoter of the investment.
- An expectation of profits from the efforts of others: The investor must have an expectation of profits from the efforts of others rather than solely from their own efforts.
The SEC argues that XRP meets all four prongs of the Howey test. Specifically, the SEC alleges that:
- Investors purchased XRP with the expectation that its value would appreciate.
- Ripple Labs promoted XRP as an investment opportunity.
- XRP holders participated in a common enterprise with Ripple Labs.
- XRP holders expected to profit from the efforts of Ripple Labs and others in the XRP ecosystem.
Ripple Labs has vehemently denied the SEC’s allegations, arguing that XRP is a utility token used for cross-border payments and not an investment contract. The company has also maintained that its sale of XRP was not an unregistered securities offering.
Ripple XRP Lawsuit: The Full History
The legal saga between Ripple and the US Securities and Exchange Commission (SEC) has been marked by a series of pivotal events, shaping the discourse around cryptocurrency regulation and the classification of digital assets. Below is a comprehensive timeline of the key milestones in the Ripple vs. SEC lawsuit.
Dec. 21, 2020: SEC Files Lawsuit Against Ripple Labs
The SEC’s lawsuit against Ripple Labs, Brad Garlinghouse, and Christian Larsen was a pivotal moment in the cryptocurrency industry. This was the first time the SEC took action against a major crypto company for allegedly selling unregistered securities. The SEC’s complaint alleged that Ripple Labs had raised over .3 billion through the sale of XRP, which it classified as an unregistered security. The SEC also alleged that Ripple Labs had engaged in ongoing sales of XRP to retail investors, further violating securities laws.
Dec. 28, 2020: Coinbase Delists XRP
Following the lawsuit’s initiation, Coinbase, a major cryptocurrency exchange, removed XRP from its trading platform. This move was a significant reaction to the legal uncertainty surrounding XRP’s status and indicated the potential market impact of the SEC’s actions. Almost all crypto exchanges followed, delisting XRP for American clients.
Ripple XRP Lawsuit: The Year 2021
March 3, 2021: Larsen and Garlinghouse Challenge SEC’s Fair Notice
Ripple’s executives contended that the SEC did not provide adequate notice that XRP would be considered a security. This defense focused on the lack of regulatory clarity and guidance for market participants regarding the status of digital assets like XRP.
March 8, 2021: SEC Requests Immediate Hearing
In a response to Ripple’s fair notice defense, the SEC sought a quick hearing, indicating the agency’s urgency in addressing and refuting Ripple’s claims and moving forward with the legal proceedings.
March 22, 2021: XRP Recognized For Currency Value And Utility
Judge Sarah Netburn’s recognition of XRP’s utility and currency value was a notable moment in the lawsuit. This ruling differentiated XRP from typical securities, suggesting a possible unique legal standing for XRP compared to other digital assets.
June 14, 2021: SEC’s Internal Crypto Trading Policies Deadline Extended
The court’s decision to extend the deadline for the SEC to disclose its internal cryptocurrency trading policies indicated the complexity and sensitivity of the information expected, which could potentially impact the case’s direction.
Aug. 31, 2021: Deadline for SEC’s Internal Crypto Trading Policies Disclosure
The disclosure of these policies was anticipated to provide transparency into the SEC’s internal stance on cryptocurrencies and potential conflicts of interest, which could have implications for the lawsuit.
Oct. 15, 2021: Expert Discovery Deadline
The inclusion of expert opinions from the fields of cryptography and securities law aimed to bring technical and legal clarity to the case, potentially influencing the court’s understanding of XRP’s nature.
XRP Ripple Lawsuit: The Year 2022
Jan. 24, 2022: Extension for Sensitive Document Disclosure
The extension allowed the SEC more time to contest the decision requiring the disclosure of sensitive documents, highlighting the critical nature of these documents in the legal battle.
Sept. 17, 2022: Motions for Summary Judgment Filed
The filing of summary judgment motions by both parties was a crucial step in the legal process, summarizing their arguments and legal positions, and moving the case closer to a resolution.
Sept. 21, 2022: Chamber of Digital Commerce Granted Amicus Curiae Brief Filing
The court’s permission for the Chamber of Digital Commerce to file an amicus curiae brief brought an additional perspective from a key blockchain advocacy group, potentially influencing the court’s understanding of the broader industry context.
Dec. 2, 2022: Replies to Summary Judgment Motions Made Public
The public release of these replies provided deeper insights into the legal strategies and arguments of both the SEC and Ripple, clarifying the stakes and positions in the lawsuit.
Dec. 22, 2022: SEC’s Attempt to Prevent Public Release of Hinman Documents
The SEC’s efforts to block the release of the Hinman documents underscored their potential significance in clarifying the SEC’s internal views and policies regarding digital assets like XRP.
Ripple Clinches Four Victories: The Year 2023
#1: June 12, 2023: Hinman Documents Unsealed And Made Public
The Hinman emails were released in the SEC Ripple case on June 13, 2023. These emails, related to former SEC director William Hinman, were part of the SEC’s lawsuit against Ripple Labs, and their release had been highly anticipated for months.
The documents included exchanges between Hinman and Ethereum founders Vitalik Buterin and Joe Lubin. They revealed that Hinman ignored instructions from high-ranking SEC officials in preparation for his June 14, 2018 speech, where he discussed Ether and its classification as a security.
Ripple’s CEO, Brad Garlinghouse, stated that the Hinman documents were “well worth the wait”. The release of these emails had severe implications for the SEC’s credibility and the ongoing XRP lawsuit, and marked the first victory for Ripple.
#2: July 13, 2023: Ripple Labs Wins The Summary Judgment
Ripple Labs achieved its second, although partial victory in its legal battle with the SEC. The US District Court for the Southern District of New York ruled that the sale of Ripple’s XRP tokens on exchanges and through algorithms did not constitute investment contracts. This was a significant decision because it implied that these sales were not subject to federal securities laws.
However, the court found that Ripple’s direct sales of XRP to institutional buyers, hedge funds, and other parties were in violation of federal securities laws. These institutional sales, amounting to approximately 0 million, were deemed as unregistered offers and sales of investment contracts. The court’s ruling was based on the expectation that investors in these institutional sales would profit from Ripple’s efforts to promote and increase the value of XRP.
This ruling was notable because it provided some clarity on the circumstances under which digital assets like XRP could be considered securities. For the programmatic sales through exchanges and algorithms, the court found no evidence that a reasonable buyer would have the expectation of profits derived from the efforts of Ripple’s management.
This aspect of the ruling was a relief for Ripple, as it suggested that regular sales of XRP to general investors did not violate securities laws. The court’s decision not to grant the SEC’s motion for summary judgment on the “aiding and abetting” claim against Ripple executives Larsen and Garlinghouse further bolstered Ripple’s position.
#3: October 3, 2023: Judge Torres Denies SEC’s Interlocutory Appeal
The SEC’s interlocutory appeal against Ripple was denied on October 3, 2023. The decision marked the third consecutive loss for the SEC in its legal battle with Ripple, where Judge Torres rejected the SEC’s attempt to appeal its loss against Ripple, setting the stage for further proceedings in the case.
#4: October 19, 2023: SEC Drops Claims Against Ripple Labs Executives
In its fourth loss to Ripple, the SEC dropped charges against Brad Garlinghouse and Christian Larsen. This left Ripple Labs as the sole defendant in the lawsuit. This decision was a surprise to many observers, as it suggested that the SEC may have been losing confidence in its case against the individual executives.
Pending: Ripple XRP Lawsuit – The Trial
A trial date has yet to commence. The trial will be a high-stakes event for Ripple Labs, as the company could face significant penalties for its institutional sales worth 0 million which were considered unregistered securities sales. The trial is scheduled to take place between April and June 2024.
The remedies phase will determine the appropriate fine for Ripple’s past institutional sales of XRP, valued at 0 million. The SEC will seek the entire amount as penalties. Ripple might attempt to reduce this figure by arguing for the exclusion of legitimate business expenses and XRP sales outside the United States.
XRP Wins Lawsuit: But What About Remedies?
John E. Deaton’s Analysis
John E. Deaton, who acted as amicus curiae in the XRP lawsuit, expressed strong confidence in Ripple’s success in the ongoing lawsuit with the SEC. He predicted that Ripple has a 99.1% chance of winning, contingent on agreeing to a fine not exceeding million. Deaton argued that the SEC could not demand significant disgorgement without proving harm to investors.
In his analysis he also emphasized that the people who viewed the SEC’s victory as 50-50 were mistaken. He suggested that it was more like a 90-10 win in Ripple’s favor. According to Deaton, if Ripple ends up paying a fine of million or less, it would represent a near-total legal victory.
Jeremy Hogan’s Analysis
Jeremy Hogan, another pro-XRP attorney, recently provided insights into the potential arguments Ripple might use during the remedies briefing. Hogan referred to the SEC v. Liu case, which emphasized that disgorgement should be “fair” and based on the violator’s net profits rather than gross. He suggested that Ripple is likely to deduct its legitimate business expenses from any potential penalties.
Hogan also pointed out that sales outside the SEC’s US jurisdiction could be excluded from the total sum. This could seriously affect the penalties’ final amount. Additionally, he mentioned that disgorgement should go to those who experienced financial losses, namely individuals or entities that suffered investment losses.
If an XRP holder acquired the cryptocurrency at a lower price than its current value, they would not qualify as victims, thus challenging the SEC’s case for disgorgement. Hogan concluded, “In conclusion, 0 million is NOT going to be 0 million, but something much less.”
XRP Lawsuit News
As of November 2023, the ongoing legal battle between Ripple Labs and the US SEC has entered a crucial phase. Both parties have submitted a joint proposal for the next stage of the lawsuit. This proposal focuses on the remedies briefing and discovery process. Important: Stay up to date with the latest news in the XRP lawsuit on NewsBTC.
XRP Lawsuit Next Court Dates: Upcoming Schedule
Pro-XRP lawyer John E. Deaton has provided the final dates for the Ripple vs. SEC case, as per the orders from US District Judge Analisa Torres. According to the schedule based on the remedies and discoveries filing:
- February 12, 2024: Deadline for both parties to conclude all remedies-related discovery.
- March 13, 2024: The SEC is required to file its brief regarding the remedies.
- April 12, 2024: Ripple will file its opposition to the SEC’s brief.
- April 29, 2024: The SEC is expected to file its response to Ripple’s opposition.
Deaton predicts that the lawsuit’s conclusion will likely occur in July 2024, during the summer. This schedule sets the stage for the final phases of this landmark case.
XRP Lawsuit End Date Predictions: When Will The XRP Lawsuit Be Over?
The Ripple vs. SEC lawsuit is entering a critical phase, with various experts providing insights on the potential XRP lawsuit end date. John Deaton sees the penalty phase as a complex stage. The SEC could demand 0 million for Ripple’s institutional sales of XRP. Deaton anticipates a time-consuming process to finalize the penalty fee, potentially extending the case into the late summer 2024.
There’s also speculation about the SEC’s intent to appeal. The SEC, led by Gary Gensler, might consider this route after Judge Analisa Torres delivers the final verdict. An appeal could prolong the case by at least another year. The XRP lawsuit end date would be dragged out for years. Earlier in the lawsuit, the SEC’s attempt for an interlocutory appeal was denied, implying they must wait for the final judgment. Given the SEC’s previous decision not to appeal in a similar case with Grayscale, the likelihood of an appeal remains uncertain.
Pro-XRP Attorney Fred Rispoli, closely following the lawsuit, commented on the recent court order that schedules the upcoming remedies phase. The court order requires the completion of remedies-related discovery by February 12, 2024, with the subsequent filing of briefs and responses extending to April 29, 2024. Rispoli speculates that in the event of an appeal, the Second Circuit may not deliver a ruling until at least mid-2026.
XRP Price Prediction After Lawsuit Win
The resolution of the Ripple vs. SEC lawsuit, especially if it results in a favorable outcome for Ripple, is expected to exert a substantial influence on XRP’s price. However, it’s important to note that price predictions are speculative and subject to various market forces.
XRP Price After Lawsuit: How High Will It Go?
The summary judgment on July 13, 2023, which found that XRP is not considered a security, had a notable impact on its market performance. Following the summary judgment on July 13, price surged from .475 to .95, marking a 100% increase. The trading volume for the token also exploded, spiking by almost 2,000%.
This surge propelled XRP to become the fourth-largest cryptocurrency by market cap. The reinstatement of XRP on major US exchanges like Coinbase, Kraken, and Gemini, which had halted trading after the SEC’s lawsuit, further bolstered this momentum. A final victory by Ripple in the XRP lawsuit could have similar implications.
Past price moves could be indicative for a XRP price prediction after lawsuit. However, neither the dismissal of the interlocutory appeal nor the dismissal of the claims against the two Ripple executives had such a major impact on the XRP price as the summary judgment.
However, predicting the exact price of XRP post-lawsuit is challenging due to the volatile nature of the crypto market. Factors like overall market trends, investor sentiment, and broader economic conditions will play a significant role. A victory by Ripple is a bullish signal for XRP. This could potentially result in a significant rise in its price.
- Short-Term: In the immediate aftermath, XRP price could experience a sharp increase as investors react to the news.
- Long-Term: Over time, the price might stabilize as the market absorbs the impact of the lawsuit resolution. Ripple could drive long-term growth by continued development and adoption in the financial industry.
XRP Price After Lawsuit Win: Predictions
Predictions about XRP’s price post-lawsuit victory vary among analysts. Some conservative estimates target a rise to by the end of the year following a Ripple court victory. More bullish analysts suggest that Ripple could retest its all-time high of .84 within hours of the court decision. Moreover, many believe that no technical resistance exists to prevent further rises in XRP’s price. Each new banking partnership could potentially serve as a catalyst for the token’s value increase.
FAQ: XRP Lawsuit
How High Will XRP Go After The Lawsuit?
The future price of XRP post-lawsuit is speculative. Factors influencing this include the lawsuit’s outcome, market conditions, and investor confidence. Previous data suggest that the XRP price is highly sensitive to news from the Ripple Labs vs. US SEC lawsuit.
When Will The XRP Lawsuit Be Over?
The timeline for the conclusion of the XRP lawsuit is uncertain. Legal proceedings can be lengthy and unpredictable. However, based on current progress of the case, the lawsuit is likely to conclude in 2024 with the remedies phase. A SEC appeal could further delay the case for years.
Did XRP Win The Lawsuit?
Ripple Labs has achieved significant legal victories. Most importantly, judge Analisa Torres ruled that the XRP token itself is not a security. However, this ruling applies only to specific aspects of the case. Additionally, the SEC achieved a partial victory: the court declared that Ripple’s institutional sales worth 0 million are security sales.
Has the XRP Lawsuit Been Dropped?
The XRP lawsuit is still ongoing. It has progressed through various stages, with recent rulings favoring Ripple. The remedies phase, starting in April 2024 is next.
Will XRP Win The Lawsuit?
Predicting the complete outcome of the XRP lawsuit is difficult. While Ripple Labs has achieved a landmark win, the case involves complex legal arguments. Also, the potential for a SEC appeal exists. Ultimately, the SEC could take the case before the US Supreme Court.
What Is The XRP Lawsuit All About?
The XRP lawsuit by the SEC concerns allegations that Ripple conducted a .3 billion unregistered securities offering by selling XRP. The SEC argues that XRP sales and trading did not meet the principles of the Howey Test.
What Is The Significance Of The XRP Lawsuit For The Cryptocurrency Market?
The lawsuit’s outcome is significant for the entire cryptocurrency industry, potentially influencing US and global regulatory approaches to cryptocurrencies. It may set precedents for how cryptocurrencies are classified and regulated.
How High Will XRP Go After Lawsuit?
The price prediction for XRP after the lawsuit is largely speculative and hinges on various market factors. Some experts and investors anticipate that XRP could reclaim its all-time high of .40.
Filmmaker Makes Millions After Risky Dogecoin Bet Pays Off — Faces Netflix Lawsuit
A U.S. filmmaker reportedly made a profit of more than million from a bet on the cryptocurrency dogecoin. Netflix accuses the filmmaker of using funds meant for the production of a TV series to place risky bets on a biotech company, the S&P 500, and dogecoin.
Rinsch Lost .9 Million in a Matter of Weeks
Carl Erik Rinsch, a U.S. filmmaker who reportedly earned a profit of more than million from a dogecoin bet, is being sued by Netflix for allegedly breaching the terms of a contract. The lawsuit accuses Rinsch of misappropriating millions of dollars that were intended to fund the production of a science-fiction television series.
Before betting on the meme coin, Rinsch is also accused of using the production funds — approximately million — to place risky bets on Gilead Sciences’ stock. At the time, the biotech firm had begun testing a Covid-19 vaccine and Rinsch reportedly wagered that Gilead Sciences’ stock would soar if the drug proved to be effective in suppressing the virus. The filmmaker is also said to have wagered that the S&P 500 index, which had declined by 30% at that point, would continue to fall.
However, neither bet panned out and Rinsch lost .9 million in a matter of weeks. According to a New York Times report, in the months that followed Rinsch began to behave “more erratically.” Netflix executives only became aware of the extent of Rinsch’s mental health problems after his wife came forward. This ultimately led to Netflix’s March 18, 2021, decision to stop funding the series.
‘God Bless Crypto’
Despite this decision and the subsequent exchanges between himself and Netflix as well as its lawyer, Rinsch still proceeded to use the remaining million to buy dogecoin. By the time he liquidated his dogecoin position in May 2021, Rinsch’s account with the cryptocurrency exchange Kraken had a balance of more than million. Pleased with the outcome, the filmmaker reportedly said, “Thank you and God bless crypto.”
Afterwards, Rinsch went on a shopping spree in which he bought five Rolls Royce luxury cars, a Ferrari, and a Vacheron Constantin watch worth 7,630 among other items. Overall, Rinsch is believed to have spent as much as .7 million.
Meanwhile, according to the New York Times report, Rinsch, who suffers from autism and attention deficit hyperactivity disorder (ADHD), insists it is Netflix which breached the terms of the contract. For the breach, the filmmaker reportedly wants the streaming service provider to pay him million in damages.
An arbitrator has already heard both parties’ arguments and is now expected to give a ruling, the report added.
What are your thoughts on this story? Let us know what you think in the comments section below.
SEC Identifies 16 Crypto Tokens as Securities in Kraken Lawsuit
The U.S. Securities and Exchange Commission (SEC) has identified 16 crypto tokens as securities in its lawsuit against cryptocurrency exchange Kraken. Some of the alleged crypto securities were the same as those highlighted in the SEC’s lawsuits against Coinbase and Binance. Kraken’s CEO stressed: “We strongly disagree with the SEC claims, stand firm in our view that we do not list securities, and plan to vigorously defend our position.”
SEC Labels 16 Crypto Tokens as Securities
In its lawsuit against crypto exchange Kraken filed on Monday, the U.S. Securities and Exchange Commission (SEC) named 16 crypto tokens as securities. The regulator’s complaint states:
Kraken currently makes available for trading crypto assets that have been the subject of prior SEC enforcement actions based upon their status as crypto asset securities, including crypto assets trading under the symbols ADA, AXS, ALGO, ATOM, CHZ, COTI, DASH, FIL, FLOW, ICP, MANA, MATIC, NEAR, OMG, SAND, and SOL.
The regulator pointed out that some of the aforementioned crypto assets had been named in several previous legal cases, including those involving Coinbase, Binance, and Bittrex. SEC Chairman Gary Gensler has repeatedly said that he views all crypto tokens, except bitcoin, as securities. However, a recent court ruling found that XRP is “not necessarily a security on its face.”
In its lawsuit against Coinbase in June, the SEC stated that crypto assets like ICP, AXS, CHZ, FLOW, DASH, VGX, FIL, NEXO, NEAR, ADA, SAND, SOL, and MATIC meet the criteria of being investment contracts. In the same month, the securities regulator identified in a lawsuit against Binance that 12 crypto tokens are securities: BNB, BUSD, SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, and COTI. In April, the SEC said DASH, ALGO, TKN, NGC, and OMG are unregistered securities in a lawsuit against Bittrex.
Responding to the SEC’s charges on Monday, Kraken CEO Dave Ripley emphasized on social media platform X: “We strongly disagree with the SEC claims, stand firm in our view that we do not list securities, and plan to vigorously defend our position.” Like Kraken, Coinbase has insisted that its platforms do not list crypto securities. In July, Coinbase’s chief legal officer, Paul Grewal, asserted that the SEC’s interpretation of “investment contract” violates the law.
After the SEC’s move against Kraken, U.S. Senator Cynthia Lummis (R-WY) called on Congress to “pass a regulatory framework to provide clear rules to the SEC on what is a security and what is a commodity.” She stressed on X: “The SEC cannot continue ruling by enforcement. Crypto asset companies have repeatedly tried to get guidance from the SEC only to be hit with enforcement actions, causing unnecessary harm to consumers.”
What do you think about the SEC stating that 16 crypto assets are securities in the Kraken lawsuit? Let us know in the comments section below.
FTX Debtors’ Lawsuit Seeks Recovery of $935 Million ‘Fraudulently’ Transferred to Bybit’s Investment Arm and Others
A new lawsuit filed by entities overseeing the FTX bankruptcy process seeks to recover 5 million that was reportedly transferred to Bybit’s investment arm and others just before the former’s Chapter 11 filing in November 2022. Bybit is also accused of using FTX assets held on its platform as leverage in its attempt to force the transfer of approximately million.
Debtors Insist Transfers to Mirana Corp Intended to Defraud FTX Creditors
A new lawsuit filed by the entities managing FTX’s bankruptcy process accuses Mirana Corp, an investment arm of the crypto platform Bybit, of using its “VIP” status to receive the larger chunk of the 5 million that was transferred just before the Chapter 11 filing. The lawsuit asserts the transfers to the investment arm were “made with the intent to hinder, delay or defraud FTX.com’s present or future creditors.”
According to FTX’s bankruptcy managers, the multiple transfers to Mirana Corp, Time Research, and certain individuals “should be avoided as fraudulent pursuant to Section 548(a)(1)(A) of the Bankruptcy Code.” Such fraudulent transfers provide FTX with the legal basis to seek the return of “the full amount of such transfers plus interest for the benefit of the debtors’ bankruptcy estates.”
As stated in the lawsuit, Mirana Corp is said to have received assets worth 7,815,847 while Time Research got ,995,279. The lawsuit added that the collapsed crypto exchange’s claim against both Mirana and Time Research “may be subject, in part, to a ‘subsequent new value.’” However, such a new value will be dependent on the value of deposits into the two entities’ FTX.com accounts after the preferential transfers.
Holding FTX Assets Hostage
Meanwhile, in addition to laying the fraudulent preferential treatment charges against Bybit’s investment arm, the lawsuit also accuses the crypto exchange platform of refusing to honor transfer requests made on behalf of FTX debtors. Instead, Bybit is said to have demanded the release of approximately million which Mirana Corp could not extract before FTX disabled withdrawals on Nov. 8, 2022.
As per the lawsuit, bankruptcy managers assert that FTX through entities it controls has assets worth 5 million held at Bybit. While there is no dispute over FTX’s ownership of the funds, the lawsuit said Bybit is continuing “to hold these assets hostage” with the hope that this will force the former to “circumvent the bankruptcy process.”
Therefore, to ensure that the funds are transferred to the debtors’ estate, FTX bankruptcy managers said they will “seek judicial enforcement of their rights under the Bankruptcy Code.”
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Former SEC Official Predicts ‘Big Win’ for SEC in Terra Lawsuit — Expects Continued Rejection of Ripple/XRP Ruling
The U.S. Securities and Exchange Commission’s former head of internet enforcement has predicted a “big win” for the SEC in the lawsuit involving Terraform Labs. The ex-SEC official also expects District Judge Jed Rakoff to keep rejecting the ruling by District Judge Analisa Torres regarding Ripple and XRP.
Stark: ‘Expect a Big Win for the SEC’
Former U.S. Securities and Exchange Commission (SEC) official John Reed Stark shared some predictions regarding the regulator’s actions against crypto firms in a lengthy post on social media platform X on Monday. Stark is currently president of cybersecurity firm John Reed Stark Consulting. He founded and served as chief of the SEC Office of Internet Enforcement for 11 years. He was also an SEC enforcement attorney for 15 years.
The former SEC official wrote:
Prediction: Expect a big win for the SEC in the SEC/Terra litigation and a gracious (yet scathing) rebuke of the recent SEC/Ripple decision.
Stark noted that both the SEC and Terraform Labs “have now filed dueling summary judgment motions, each seeking an early victory about whether crypto tokens are securities.”
In the SEC lawsuit against Terraform Labs and its co-founder Do Kwon, Judge Jed Rakoff of the United States District Court for the Southern District of New York (SDNY) rejected District Judge Analisa Torres’ ruling regarding Ripple and XRP. “The court rejects the approach recently adopted by another judge of this district in a similar case, SEC v. Ripple Labs Inc.,” Judge Rakoff said in August.
The former SEC internet enforcement chief continued:
My take is that famed securities law expert Judge Jed Rakoff, who is presiding over the SEC/Terra matter, is chomping at the bit to (politely) label the Ripple decision by fellow SDNY Judge Analisa Torres as both aberration and abhorration.
Stark believes that for SEC lawyers, Judge Rakoff is “arguably considered the most respected and experienced securities law jurist not only in the SDNY but perhaps in the entire U.S. federal court system.” The ex-SEC internet enforcement chief concluded:
The stark reality is that Judge Rakoff already repudiated and spurned Judge Torres’s decision and it seems inevitable that he will do so again, not just at the summary judgment phase, but also anytime in the future when addressing the application of securities laws to digital assets.
What do you think about the predictions by former SEC internet enforcement chief John Reed Stark? Let us know in the comments section below.