Two US Law Firms File Class Action Against Altcoin Nano and Exchange BitGrail

Published at: Jan. 8, 2019

Two United States law firms have filed a lawsuit against the developers of altcoin Nano (NANO) as well as Italian cryptocurrency exchange BitGrail, according to a notice published Jan. 7.

Crypto-focused law firm Silver Miller and securities law firm Levi & Korsinsky have filed a class action lawsuit representing James Fabian — “and on behalf of all other persons similarly situated” — an investor in Nano, formerly known as RaiBlocks (XRB).

The lawsuit alleges that Nano and “key members of its core team” violated federal securities laws and directed investors to open accounts and place funds in “little known, and severely troubled” Italian cryptocurrency exchange BitGrail. According to the lawsuit, the defendants also include BitGrail itself, as well as the exchange’s CEO, Francesco “The Bomber” Firano “in connection with their promotion of a cryptocurrency called NANO.”

In a controversial incident, over $180 million in Nano — calculated at the time of the event — went missing from the exchange in February, 2018.

The lawsuit asks the court to order Nano to perform a ‘rescue fork’ of the allegedly lost Nano “into a new cryptocurrency in a manner that would fairly compensate the class of victims.”

In a note on their website posted Feb. 9, BitGrail stated that 17 million Nano had been stolen in a hack. However, following the hack both BitGrail and the Nano team accused the other of being responsible for the theft of the tokens.

BitGrail’s CEO Firano told Cointelegraph in an interview that “it’s impossible to refund the stolen amount.”

A similar lawsuit was filed in April 2018, representing Nano investor Alex Brola. The lawsuit also accused Nano’s team of violating U.S. securities laws by selling unregistered securities and negligently misrepresenting the reliability of BitGrail.

Later in October, Brola voluntarily withdrew the suit. The lead defense counsel Peters Scoolidge reportedly said that “the plaintiff withdrew the complaint because the case lacked merit.”

Last month, Silver Miller filed a lawsuit against purported crypto hedge fund manager Jeremy Spence, accusing him of operating a fraudulent Ponzi scheme and promising “lucrative returns.” The returns reportedly were not profits from investments, but “were simply reallocations to older investors of new investors’ assets,” in a classic Ponzi scheme configuration.

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