A digital currency startup that hailed its blockchain platform as the fastest in the Milky Way has agreed to settle a class action lawsuit. ATBCoin conducted its initial coin offering (ICO) back in 2017, but was soon after sued for issuing an unregistered securities offering. The class action lawsuit has now come to an end, with the company set to part with $250,000 in settlement offer.
ATBCoin conducted its ICO between June 12 and September 15, 2017, selling its native ATB Coins. It described the tokens as “an innovative decentralized cryptocurrency incorporating the advanced technologies that tailor the needs of primary market players—users, investors, and business owners.” It claimed that transactions in ATB Coins were fully private, secure and anonymous. The company managed to raise $20 million from its ICO.
ATBCoin’s blockchain launched in September, soon after the ICO concluded. However, it was unable to reach the heights it had promised, including being the fastest blockchain platform in the Milky Way. Inevitably, its price started dropping and in a few weeks, it was 85% below its issue price.
The investors soon launched a class action lawsuit, led by the lead plaintiff Raymond Balestra. They accused the company of conducting an ICO without registering with the SEC. The case is coming to a close, with Law360 reporting that Balestra has come to an agreement with ATBCoin on behalf of the aggrieved investors.
Balestra’s legal team filed the motion for preliminary approval with the U.S. District Court for the Southern District of New York. The settlement had come after lengthy negotiations between the two parties, the filing claims, stating, “Lead Plaintiff respectfully submits that the Settlement warrants preliminary approval because it is the result of vigorous arms-length negotiations by experienced counsel, representing a favorable recovery that falls well within the range of possible approval.”
Investors have continued to step up and sue companies they believe have been issuing or selling unregistered securities. In one of the biggest class action lawsuit yet, a New York law firm recently sued 11 of the largest companies in the digital currencies industry. Roche Cyrulnik Freedman LLP sued Binance, the Tron Foundation, Civic, BitMEX and more, claiming they either issued or traded unregistered securities.
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