Block.one (B1), the creator and original seller of EOS, may face additional legal action which could potentially result in higher compensation for plaintiffs, according to Yves La Rose, founder and CEO of EOS Network Foundation (ENF).
On July 25, La Rose officially announced that ENF is preparing to file a lawsuit against Block.one for failing to fulfill its $1 billion commitment following its $4.1 billion raise in 2018. The CEO argued that Block.one’s broken promises to invest $1 billion have caused significant issues for the EOS community and vowed to hold the company accountable.
As many investors have already been part of another class action against Block.one, some may need to opt out of their current lawsuits, La Rose explained. He highlighted that opting out could potentially result in a higher payout but also comes with the risk of receiving nothing. Therefore, the ENF founder advised individuals to consult their own legal counsel to determine the best course of action for them.
La Rose further emphasized that the current class action settlement amount might not be sufficient for those affected. He criticized Block.one’s offer of $22 million as “pathetic,” considering the damages caused by a $4 billion raise. According to La Rose, the contemplated new action would expand the pool of potential participants and provide an opportunity for those who were not covered in the current class.
In 2018, Block.one’s EOS initial coin offering (ICO) became one of the largest fundraising campaigns in history, raising $4.1 billion. However, the value of EOS experienced a significant decline, trading at around $12 by the end of its year-long crowdsale, down from its peak price in April 2018. The cryptocurrency continued to fluctuate and eventually dropped below $1. Currently, EOS is trading at $0.74, representing a 30% decrease over the past year.
Despite the decline, EOS remains one of the largest cryptocurrencies by market capitalization, with a value of $827 million. This makes it the 54th largest coin by market value, according to CoinGecko.
In 2019, Block.one agreed to pay a $24 million civil fine to settle charges by the United States Securities and Exchange Commission regarding its unregistered ICO. Subsequently, disgruntled investors initiated a class-action lawsuit against Block.one, alleging deception about the company’s financial history, operations, budget, executive compensation, and other factors.
In conclusion, the legal action being prepared by EOS Network Foundation against Block.one aims to seek compensation for the broken promises made by the company. The lawsuit could benefit plaintiffs who opt out of the current class action and potentially result in higher compensation. However, the outcome is uncertain, and individuals are advised to seek professional legal advice to determine the best course of action for their specific circumstances.
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