Crypto Investors Renew Efforts to Finalize $22M Block.one Settlement

News | June 7, 2024 By:

On Friday, May 24, 2024, lead plaintiff Crypto Assets Opportunity Fund LLC filed a renewed motion for final approval of a $22 million class action settlement with cryptocurrency company Block.one over its $4 billion initial coin offering.

The motion seeks approval of the settlement that was originally reached in March 2023. According to the filing, the settlement is an “excellent recovery” for the plaintiff class and was the result of “several rounds” of arm’s-length negotiations between the parties. The motion argues that the $22 million deal amount is fair and reasonable given the substantial risks of continuing costly litigation and considering the total amount the class could potentially recover if successful.

Notably, the settlement approval process has faced multiple delays. Lead counsel is requesting $5.5 million in attorney fees, approximately 25% of the settlement fund, along with $81,000 in litigation costs and a $31,000 service award for the lead plaintiff. However, a final fairness hearing scheduled for last September was adjourned by the court with no new date set.

Then in November, the court directed the parties to provide details on each potential class member, such as their estimated settlement payment and loss amount. Crypto Assets says it met the deadline by emailing this information to the court. Despite this, the settlement was denied in February for allegedly failing to provide the required information. Lead plaintiff filed a motion for reconsideration in March, arguing the court overlooked their prior submission.

The renewed motion comes as the latest development in a class action lawsuit against Block.one over its 2017 initial coin offering for the EOS digital token. The suit alleges Block.one violated federal securities law by failing to register the tokenized fundraise with the SEC and misrepresenting how ICO funds would be used.

Instead of technology development, the suit claims Block.one channeled over $4 billion into speculative crypto trading, causing EOS prices to decline substantially below what was promised to investors. Block.one previously paid $24 million to settle separate SEC allegations related to the ICO without admitting fault.

Please contact BlockTribune for access to a copy of this filing.