Cryptocurrency pioneer Charlie Shrem is facing a lawsuit at the hands of Cameron and Tyler Winklevoss, the twins that founded cryptocurrency exchange Gemini and the first known “bitcoin billionaires.”
According to the New York Times, the duo believes Shrem has gone on a spending spree with bitcoin he was supposed to give them. This, as in 2012 the Winklevoss twins reportedly gave Shrem several hundred thousand dollars to buy BTC.
At the time bitcoin was trading at little over $10, according to CryptoCompare data. Per the lawsuit. Shrem allegedly did not give back what amounts to 5,000 bitcoins, now worth about $37.1 million.
The missing cryptocurrency seemed to have be forgotten after the Winklevoss twins cut off contact with Shrem once he went to prison after pleading guilty in an operation he ran, that some used to buy BTC for drugs.
Now the brothers have filed a lawsuit against Shrem because they allege he has bought a variety of luxury items with money that should be in their pockets. According to the recently unsealed lawsuit, Shrem has bought six properties, two Maseratis, two powerboats, and some other holdings over the past year.
The accusation is Shrem has been bankrolling his purchases with the “appreciated value of the 5,000 bitcoins he stole” from the Winklevoss twins.
The New York Times reported how Shrem’s lawyer, Brian Klein, asserted the allegations are baseless. He said Shrem would be ready to clear his name and defend himself.
Court documents reveal a judge has agreed to freeze some of Shrem’s assets. There is also speculation the case could spiral due to allegations Shrem has failed to pay $950,000 in restitutions to the government related to his guilty plea.
A Troubled Past
Shrem has not been shy about discussing his past and has mentioned desire to craft a new path. He said in a podcast he found work as a dishwasher after prison and stayed away from checking his email.
Shrem noted how much of his earlier wealth was spent on legal fees, and his $8 dollar an hour job washing dishes was “one of the best experiences.”
However, he has attracted headlines after being part of the leadership of two different endeavors that had to give money back to investors. Some think the court battle with the Winklevoss brothers could saddle his latest venture, CryptoIQ, with a lot of issues.