On Thursday, a lawsuit was filed in Florida’s Southern District against a group of cryptocurrency heavyweights alleging intentional fraud and market manipulation surrounding the recent Bitcoin Cash BCH update.
The civil suit filed by United American Corp. against multiple Bitmain related companies, Bitcoin.com, Roger Ver, Jihan Wu, Kraken, Jesse Powell, Amaury Sechet, Shammah Chancellor and Jason Cox alleges the group was involved in a scheme to manipulate the cryptocurrency market for Bitcoin Cash in an effort to highjack the Bitcoin Cash network, resulting in a global capital meltdown of more than $4 billion and causing countless people irreparable harm.
Some of the names are well known to the Bitcoin community while others have been background players. Let’s have a look at the who’s who in this landmark cryptocurrency lawsuit.
Bitmain Inc. – More commonly known as Bitcoin US, Bitcoin Inc. is an American corporation wholly owned by Bitmain Technologies Holding Company. With Bitmain Inc. being a USA corporation, it will be difficult for the larger company to claim the suit doesn’t belong in American courts.
Bitmain Technologies LTD. – Founded by Micree Zhan and Jihan Wu in 2013, Bitmain rose to prominence and then dominance in the bitcoin mining space with their ASIC cryptocurrency miners.
Bitmain Technologies Holding Company – The company filed for an initial public offering this past September 26 with the Hong Kong regulatory agency. That IPO has been in doubt of late with disastrous financials leaking and their reputation taking a beating during the hash war that triggered this lawsuit.
Saint Bitts LLC d/b/a Bitcoin.com – Bitcoin.com is one of the more controversial websites in the cryptocurrency industry. Bitcoin.com is probably responsible for onboarding more people to Bitcoin that any other site. They offer news, tools and even online gambling but after the 2017 BTC-BCH split, and their propensity for hyping up poorly planned and executed ICOs they’ve become more divisive in the past couple years.
Roger Ver – Known as the Bitcoin Jesus due to his early wiliness to invest and travel the world spreading the gospel of Bitcoin. He’s fallen from Grace particularly after the 2017 BTC-BCH fork. Ver would debate anyone and everyone, claiming BCH was the true Bitcoin and any chain that deviates from the Satoshi Whitepaper couldn’t claim to be Bitcoin. His decision to support the ABC instance during the hash war and his penchant for putting his promotional support behind pump and dump ICOs has left many of his disciples abandoning the faith. Ver denounced his American citizenship in 2014 and was once denied a USA visa as US immigration was unsure if he’d leave the country and he’d remain as an illegal immigrant. This case should offer US immigration sufficient grounds for a visitor’s visa.
Jihan Wu – He’s the public face of the Bitmain empire. A regular on the conference circuit and recipient of the lion’s share of both the praise and the scorn from the cryptocurrency community. He was the power broker during the 2017 battle for larger blocks in BTC, his mining pools held enough power to determine whether Blockstream’s Segregated Witness and the plan to leave BTC at 1MB blocks or if the big block battle would continue. Wu negotiated a split which created Bitcoin Cash BCH and took the big block supporters with him. He also played a major role in the Hash War, funding the controversial ABC instance and then arranging the mercenary miners to move over to the BCH chain. Like Ver, the split has left his reputation in tatters.
Payward Ventures Inc. d/b/a Kraken – Kraken is a cryptocurrency exchange site that was funded by Roger Ver and operated by his high school friend Jesse Powell. The site was one of the more popular exchanges operating in the US, Canada, Japan and the EU. For a couple of years, it stood as the largest exchange in the industry before giving way to companies like Coinbase and Binance. This lawsuit isn’t the first time Kraken has faced scrutiny, earlier this year they were under investigation by the New York Attorney General’s (NYAG) office who was on a fact-finding mission to see what if any measures exchanges took to protect their customers from market manipulations.
Jesse Powell – Powell, in addition to being Ver’s high school friend, is the CEO of Kraken. When the NYAG was conducting their investigation, Powell made a point not to cooperate and declared the investigation was hostile and bad for business. Unlike Ver who renounced his USA citizenship and left the country, Powell still resides in the US and could be forced to do the heavy lifting if Ver doesn’t return to answer the suit.
Amaury Sechet – Sechet is the lead developer for Bitcoin ABC and the self-proclaimed benevolent dictator of Bitcoin Cash BCH. The anarchist is a French national who is responsible for the contentious changes to the node software that ultimately caused the rift and eventual fork in the BCH chain.
Shammah Chancellor – Is a developer with Bitcoin ABC who works with Sechet.
Jason Cox – Along with Chancellor, works with Bitcoin ABC as a developer.
United American Corp. – The Florida-based company focuses on telecommunications applications, including BlockchainDomes, which are eco-friendly crypto mining facilities that use the generated heat to power green houses and grow food. In 2017, UAC moved heavily into the development and implementation of blockchain-related technologies. The company believes that the high-jacking of the Bitcoin Cash network could imperil its investments, as the changes brought by Bitmain and Ver’s group have altered the fundamental economics of the business.
The post Meet the players in the BCH Market Manipulation Lawsuit appeared first on CoinGeek.
The cryptocurrency world was rocked Thursday by the announcement of a huge lawsuit that was launched by United American Corp. (UAC) against a large number of Bitcoin Cash BCH supporters, including Bitmain and its co-founder Jihan Wu, Bitcoin.com founder Roger Ver, Amaury Séchet of Bitcoin ABC, the Kraken exchange and its CEO, Jesse Powell, as well as a few others. The lawsuit contends egregious amounts of fraud and market manipulation on the part of all defendants and could forever change how BCH is viewed, MarketWatch first reported. The lawsuit and all updates will be available on the www.bitcoincashlitigation.com website.
UAC points out in its lawsuit, filed in U.S. District Court for the Southern District of Florida, that the group of individuals colluded to manipulate the BCH network and take control of its functions. The company asserts that BCH has become centralized, which violates “all accepted distributed and decentralized standards and protocols associated with Bitcoin since its inception.” The Florida-based blockchain company further asserts that Ver, Wu, et al worked in conjunction with the Chinese government in order to lead a hostile takeover of the cryptocurrency.
The blockchain is meant to be a decentralized solution. To maintain this decentralization, the network operates on a consensus basis that prevents a single person or group from being able to control the majority of the hash, or mining power. If someone is able to control 51% of the network, they can effectively and autonomously decide the blockchain’s fate and this is what the defendants have been able to achieve.
Bitmain publicly acknowledged its support of Bitcoin ABC during the hash wars and launched efforts to force the BCH network to follow ABC during the hash wars. It rented hash power and even deployed 90,000 of its own mining rigs in favor of ABC mining operations, a move that can be seen as an attempt to centralize and control ABC. There were also speculations that Bitmain’s Jihan Wu was unloading BTC to fund the ABC mining operations, which, in turn, drove the prices of crypto down. Now, people are wondering if Wu is just cashing out amid the hash war.
Meanwhile, the U.S. Department of Justice is also allegedly looking to get involved in the case against Bitmain and Ver’s group through the FBI Cybercrimes Division.
Roger Ver is a “crypto anarchist” and has also directed the mining operations of his Bitcoin.com mining pool to ABC. In addition,Bitcoin.com was a recipient of some of the hashing power that was rented by Bitmain in order to support ABC.
Ver has direct links to the Kraken crypto exchange through its founder, Jesse Powell. They are friends with a history that dates back to their high school days and Kraken was one of the first exchanges to show favoritism for ABC. It was also the first exchange to declare that ABC was offering the true version of BCH.
The lawsuit explains that Bitcoin ABC, the development and mining group that favored moving BCH away from its original design, has now forced changes on the blockchain without regard to what the community wanted. It introduced arbitrary checkpoints that can allow Bitcoin ABC to take over the network. UAC explains, “Combining this change with the hashing power of Bitcoin ABC backers amounts to centralization. They will be able to override any consensus reached by the rest of the network, forcing other to conform or create an unwanted hard fork.”
UAC also asserts that the entities were fundamental in directing hash power—including through the renting of additional mining equipment—during the BCH “hash wars” this month that saw them force the direction the BCH blockchain was headed. The action resulted in an unprecedented amount of hash being processed by Bitcoin ABC backers and further disintegrated the integrity of the BCH network.
UAC has been involved in blockchain innovation since 2017 and has invested more than $4 million in the space. It argues that the selfish manipulation of the blockchain is not consistent with BCH’s design, and that it has completely altered the “fundamental economics of the business.” In simple terms, it can be viewed as ordering a Filet Mignon in a restaurant and being delivered a burnt hamburger, while still paying for the Filet Mignon.
For a deeper narrative about the scheme, visit the Bitcoin Cash Litigation website.
The full filing can be found here.
The post Breaking down the United American lawsuit against Bitmain, Roger Ver, et al appeared first on CoinGeek.
Miami, FL. – In a lawsuit filed on Thursday December 6th in the United States District Court for the Southern District of Florida, United American Corp. a Florida Company, petitioned the court for emergency injunctive relief citing losses stemming directly from the Bitcoin Cash fork that began on November 15, 2018, and asserting that a team of conspirators involved in what many are calling the “Bitcoin Cash Civil War” worked with the knowledge and support of the Chinese government to stage a premeditated hostile takeover of this popular cryptocurrency platform.
The litigation, being handled by a team of attorneys led by Brian Miller, of the powerhouse Miami-based law firm Akerman, alleges there was “a scheme by a tight network of individuals and organizations designed to co-opt the cryptocurrency market for Bitcoin Cash, effectively hijacking the Bitcoin Cash network, centralizing the market and violating all accepted distributed and decentralized standards and protocols associated with Bitcoin since its inception.” It claims this scheme caused “a global capitalization meltdown of more than $4 billion and caused many American and Canadian coin holders to suffer financial damages.”
Since 2017 United American Corp. has moved heavily into the development and implementation of blockchain and blockchain technologies and invested in the deployment of over $4 million of infrastructure towards that end. Those investments can be greatly imperiled by changes in the Bitcoin Cash network brought about by the alleged scheme, changes that have altered the fundamental economics of the business.
The lawsuit moves against multiple defendants: Bitcoin.com, Roger Ver, Bitmain Inc. Bitmain Technologies LTD. Bitmain Technologies Holding Company, Jihan Wu, The Kraken LLC, Jesse Powell, Amaury Sechet, Shammah Chancelor and Jason Cox.
This legal action will seek to prove that specific key actors, including some of the biggest US-based and international names and entities in the digital currency world, have been operating with the support of the Chinese government to centralize the Bitcoin cash network resulting in Chinese entities now having established dominance over this important segment of the cryptocurrency market with proprietary software checkpoints and instituting other means of control over the system.
“We want the future of cryptocurrency in general and Bitcoin Cash in particular to live up to the tremendous potential of the Satoshi white paper’s original vision,” said Lawry Trevor-Deutsch, Vice President of Corporate Affairs for United American Corp. “We envision a future led by an open, democratic and collaborative community fostering innovation and freedom. No entity or group of entities should seek to seize control of this platform for their own narrow interests or create rules that inhibit new competition and future technological innovation. That’s what this lawsuit is about.”
For additional information on the alleged Bitcoin Cash takeover scheme click here.
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