Crypto influencer named in FTX lawsuit served via tweet

May 3, 2023 Coin Telegraph

Bitboy

A law firm backing an FTX investor suit tagged a crypto influencer in a tweet to serve its lawsuit.

A cryptocurrency YouTuber has been served a lawsuit through a tweet after a United States court allowed the action as lawyers claimed they couldn’t serve him through other means.

A May 2 order from a Florida District Court Judge granted The Moskowitz Law Firm permission to serve legal notice to crypto YouTuber Tom Nash via a tweet.

Nash, who is believed to be residing in Georgia, is the last of ten defendants named in a class action lawsuit against influencers alleged to have promoted the now-bankrupt cryptocurrency exchange FTX without disclosing their compensation.

On May 2, the firm tweeted its notice to Nash and mentioned his Twitter handle in the post, thereby giving him legal notice of the lawsuit.

@iamtomnash, per the authorization of the Court presiding over the pending class action against you in the Southern District of Florida, you have been served: https://t.co/28YJQ2sKY5
— The Moskowitz Law Firm (@moskowitzesq) May 2, 2023

The filing set out instructions on how Nash was to be served using Twitter.

A legal notice URL was required to be shared by the law firm through its official Twitter account and tag Tom Nash’s Twitter account.

Moskowitz was also required to send the URL in an email to his publicly known email address.

The filing states Nash’s frequent internet use suggests that it is a reliable way of contacting him. It noted:

“Nash has an established Internet-based business, utilizes electronic means, including Twitter, as reliable forms of contact; and has publicly acknowledged [a] personal email address.”

According to the filing, when lawyers previously emailed Nash on an email he had publicly posted, it didn’t bounce back, which suggested Nash received the suit and his “e-mail address is valid and operational.”

A federal ruling allows the district court to “order an alternate method for service to be executed on foreign defendants” provided it isn’t against international agreements and is likely to effectively notify the defendant.

It further explained that Georgia and the U.S. are parties to The Hague Convention which provides a standardized method for serving legal documents between countries that are signatories of the treaty.

The other nine defendants comprise seven YouTubers including Graham Stephan, Brian Jung and Ben Armstrong, known as “BitBoy Crypto.” The talent management company that handled the promotion of FTX, Creators Agency LLC, and its founder Erika Kullberg are also named.

Armstrong had missed a court appearance on April 20 to address his alleged “harassment towards plaintiffs’ counsel.”

Instead of attending the court hearing, Armstrong posted pictures of himself on a beach in the Bahamas on Twitter and openly mocked the order.

I am supposed to be in court today.

I’m not. Why?

Because I don’t give AF

RECKLESSNESS SPONSORED BY https://t.co/RtFomcGS5v pic.twitter.com/t9XqsNd6da
— Ben Armstrong (@Bitboy_Crypto) April 20, 2023

Cointelegraph contacted Nash for comment but did not immediately receive a response.

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Voyager’s $1B sale to Binance.US put on hold by US court

March 28, 2023 Coin Telegraph

<div>Voyager's B sale to Binance.US put on hold by US court</div>

Appeal

A federal judge has temporarily halted a proposed deal between Voyager and Binance.US in order to give the government more time to pursue appeals that challenge the deal.

Voyager Digital’s $1 billion sale to Binance.US has been temporarily halted by a federal judge after a request by the United States government for an emergency stay.

The request for an emergency stay was granted by Judge Jennifer Rearden of the U.S. District Court in New York on March 27, meaning the potential deal between Voyager and Binance.US will now need to wait until at least a decision is made on the Department of Justice’s appeal against the bankruptcy plan.

*District Court Judge Jennifer Rearden granted approval of the U.S. DOJ’s emergency motion. Source:* *Court Listener*

The DOJ filed the emergency application for a stay on March 17. This motion was promptly challenged by Voyager Digital and the Official Committee of Unsecured Creditors on March 20 and responded to again by the DOJ in a final “reply” motion on March 21.

In its latest order, Judge Rearden summarized:

“Upon consideration of all parties’ written submissions, as well as the conferences and oral argument held in this matter, the Government’s emergency motion is hereby GRANTED.”

The federal judge will soon release an opinion explaining the decision in more depth.

The cryptocurrency trading firm filed for Chapter 11 bankruptcy on July 5 and has been proactive in coordinating a plan to redistribute funds ever since.

The Binance.US acquisition of Voyager was granted by Judge Wiles on March 7. Part of that approval involved the issuance of bankruptcy tokens to impacted Voyager customers.

However, U.S. regulators have made multiple attempts have been made to halt the deal.

In addition to the DOJ, the U.S. Securities Exchange Commission argued in a March 15 motion that Voyager’s bankruptcy plan would give rise to fraud, theft or tax avoidance. However, this claim was later denied by Judge Michael Wiles.

The Voyager Official Committee of Unsecured Creditors explained in a March 27 Twitter post that they “will continue to aggressively oppose the Government’s efforts.”

3/ The Committee is still analyzing the situation and awaiting the district court's forthcoming written opinion. We will continue to aggressively oppose the Government’s efforts and will provide further updates as they become available.
— Voyager Official Committee of Unsecured Creditors (@VoyagerUCC) March 27, 2023

Over 97% of 61,300 Voyager account holders favor the restructuring plan, according to a poll released in a Feb 28 court filing. The plan is expected to pay out 73% of what Voyager customers are owed.

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SBF’s inner circle received $3.2B, mainly from Alameda: Court filings

March 16, 2023 Coin Telegraph

Alameda

Billions worth of loans and payments flowed from FTX entities to Sam Bankman-Fried and five other former executives of FTX and Alameda Research.

FTX and Alameda Research's former top brass received $3.2 billion in payments and loans from FTX-linked entities, according to the FTX administrators handling the firm's restructuring.

FTX, now helmed by CEO John Ray III, has been tracking missing funds from the exchange since its collapse, which it estimates to be $8.9 billion in total.

According to a March 15 statement from FTX Debtors, financial statements it filed in the Delaware Bankruptcy Court point to billions of dollars worth of loans and payments that allegedly flowed to Sam Bankman-Fried and high-ranking executives, which came mainly from trading house Alameda Research.

Sharing the FTX Debtors’ press release just issued: https://t.co/r7PlneGSXF
— FTX (@FTX_Official) March 16, 2023

Bankman-Fried however reportedly received the lion’s share of the funds at $2.2 billion.

Others named in the list include former FTX director Nishad Singh, FTX co-founder Gary Wang, and former CEO of Alameda Research Caroline Ellison, among others.

It provided a rough breakdown of the payments made to the FTX executives, as follows:

$2.2 billion to Sam Bankman-Fried
$587 million to Nishad Singh — former FTX director of engineering
$246 million to Zixiao "Gary" Wang — FTX cofounder
$87 million to Ryan Salame — former co-CEO, FTX Digital Markets (FTX’s Bahamian entity)
$25 million to John Samuel Trabucco — former co-CEO, Alameda
$6 million to Caroline Ellison — former CEO, Alameda

The amounts exclude over $240 million used for various purchases, such as luxury properties in the Bahamas, donations to political and charitable causes and “substantial transfers” to non-FTX subsidiaries, it noted.

FTX’s management said it is currently investigating its rights to pursue potential action against the recipients, along with their subsequent transferees, and that ongoing efforts are “expected to result in the further identification of assets, liabilities and transfers.”

It added it’s looking at ways to claw back the funds from the former executives but said the “amount and timing of eventual monetary recoveries cannot be predicted at this time.”

Bankman-Fried is facing 12 charges relating to conspiracy, wire and securities fraud in connection to the alleged mishandling of funds at FTX and its affiliates. He previously plead not guilty to eight similar original charges.

Ellison, Wang and Singh have pleaded guilty to charges similar to those brought against Bankman-Fried and are cooperating with investigations spearheaded by federal prosecutors.

The first known instance of an executive from FTX or Alameda assisting authorities came as Salame blew the whistle to Bahamian regulators of the potential fraud being perpetrated at FTX which lead them to shutter the exchange just two days later on Nov. 11.

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Ripple CEO: XRP lawsuit resolved by June, SEC conduct ’embarrassing’

January 19, 2023 Coin Telegraph

Brad Garlinghouse

Ripple CEO Brad Garlinghouse said the firm's XRP lawsuit could come to an end within "single-digit months."

Ripple CEO Brad Garlinghouse expects the firm’s long-running dispute with the Securities Exchange Commission (SEC) will be finalized within “single-digit months” and remains confident in securing a favorable outcome.

Speaking to CNBC on Jan. 18 at the World Economic Forum in Davos, Switzerland, Garlinghouse said the verdict could come as soon as June this year now that both parties have “fully filled and fully briefed” their arguments before the U.S. District Court:

“We expect a decision from a judge certainly in 2023. You don’t really have control over when a judge makes their decisions. But I’m optimistic that sometime in the coming single digit months we’ll have closure there.”

While Garlinghouse and investors believe the facts, law and the court will ultimately side with Ripple, the Ripple CEO also took the opportunity to ridicule the SEC’s “embarrassing” behavior displayed throughout the lawsuit, noting:

“The SEC’s behavior in some of it has been embarrassing as a U.S. citizen. Just some of the things that have been happening, like you’ve got to be kidding."

Garlinghouse also argued the firm was betrayed by the regulator, as it filed the lawsuit despite their efforts to meet with them on three separate occasions seeking regulatory clarity:

“Not once did they say to me we think XRP may be a security. So to later go back and say hey the whole time we thought XRP was a security we just didn’t tell you… that doesn’t feel like a genuine partnership between public sector and private sector.”

While noting that the outcome of the case also has huge implications for the cryptocurrency industry, Garlinghouse reiterated that Ripple would only settle if it was made clear that XRP is not a security.

However, “the SEC and Gary Gensler has very outwardly said he views almost all crypto as a security” Garlinghouse said, “so that leaves very little space in the Venn diagram for settlement,” he added.

*Garlinghouse speaking with CNBC at the World Economic Forum in Davos, Switzerland. Source:* *CNBC.*

Garlinghouse added that the U.S. SEC should take note from some of the more crypto-friendly countries who are piecing together more “positive” regulation that doesn’t stifle innovation.

Among the countries he spoke highly of included the the United Arab Emirates, Japan, Singapore, Switzerland and the U.K.

The lawsuit was initiated by the SEC in December 2020, claiming that Ripple illegally sold its XRP token as an unregistered security.

Ripple has long disputed the claim, arguing that it doesn’t constitute an investment contract under the Howey test.

Should the two sides fail to settle, the New York-based District Court will either make a standalone ruling or put the matter before a jury in a trial.

Court Filing