Altcoins

Nano Lawsuit Update: Angry Investor Reacts to Motion to Dismiss

Christine Vasileva | Jan 15, 2020 | 11:00

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James Fabian, the chief plaintiff in the securities class action suit against the Nano crypto company, has asked a judge to strike against each point of dismissal that Nano supplied last fall.

Nano Dismisses Claims in 10-Point List

Fabian, who faced losses after the hack and closing of the BitGrail exchange, believes Nano did not have sufficient excuses to claim lack of responsibility for the loss of coins. The Nano company, on its side, filed a list of 10 dismissals, which Fabian believes are insufficient.

According to Law360, Fabian stated,

Such boilerplate purported defenses are not proper affirmative defenses, are not pleaded with sufficient particularity to give plaintiff notice of their bases, and are not supported by any facts or explanations as to how they apply to this case

The Nano team was also reportedly aware of the possibility for double-spending, which could have caused withdrawals from an exchange, thus depleting its wallets. Fabian added that the team did not warn its early supporters of the risks.

The BitGrail exchange was also one of the few markets to list NANO in its early days. Becoming an adopter required buying coins on that exchange, exposing traders to risks.

Eventually, the BitGrail exchange and its founder, Francesco Firano, were found guilty of not disclosing the double-spending. But the Nano team also faces a class action lawsuit, as being partial to the loss of coins. In the end, it turned out the funds were taken away using a glitch that served multiple withdrawals, as evidenced by activity and requests from Nano nodes. The judgment on the exchange was passed about a year ago.

For the #NANO holders on @BitGrail https://t.co/ZnC9tARzcw

— Matthias Szymanski (@Matthiasszyma) January 29, 2019

 Project Hit Hard By The Altcoin Bear Market

The Nano project, which distributed coins freely through a faucet, moved into the next stage with exchange listings. The prevalence of BitGrail deposits was not unusual for a coin in its early stages. Nano took its time to bring out a working wallet for months, causing users to store funds on the exchange. But there was also the additional practice of keeping coins on exchanges, to avoid supporting too many wallets while also having the opportunity to trade.

The BitGrail exchange claimed it was hacked in February 2018, losing an estimated $170 to $195 million. This was worth around 17,000 NANO at the time. The token had just peaked about a month before at $34.44, one of the biggest success stories in late 2017 when all altcoins pumped.

NANO now trades around $0.70, after a 10% rally in the past day. But the asset has not recovered and has only crashed during the prolonged bear market.

What do you think of the losses caused by BitGrail and Nano’s response? Share your thoughts in the comments section below!

Images via Shutterstock, Twitter @Matthiassyzma