Class Action Filed Against Nano Over Fraudulent Misrepresentation

Neil Dennis

Law firms Silver Miller and Levi Korsinsky have filed a class action lawsuit with the district court of Northern California against the promoters of the Nano cryptocurrency, alleging fraud and misrepresentation.

The filing summarized that the class action was on behalf of all individuals and entities who transferred fiat currency or crypto to BitGrail - the now-defunct Italian crypto exchange that lost around $170 million in Nano tokens - to invest in Nano between October 24, 2015 and February 8, 2018.

Shilling on Social Media

Chief among the allegations of fraud and misrepresentation are whether the defendents promoted Nano and BitGrail despite being aware of the exchange's shortcomings. The filing points to the use of social media to promote Nano - and mentions specific instances of defendent Troy Retzer downplaying critial comments on Reddit.

The filing states:

To fulfill their role in the conspiracy, Defendants Colin LeMahieu, Mica Busch, Zach Shapiro, and Troy Retzer created and managed the XRB network and used social media channels such as Twitter, Medium, and Reddit to recruit unsuspecting investors in the United States and abroad to purchase XRB investments and allow the liquidation of XRB coins and/or store those valuable assets at the inherently unsafe BitGrail exchange.

Such promotional tactics, the plaintiff lawyers believe, may have exacerbated the losses on BitGrail as investors were directed to the troubled Italian exchange. Nano hit its price peak around $35 in January 2018 and now stands at $0.77. At the time the tokens went missing in February 2018, the price was around $16. 

The action asks that the court should require Nano to "rescue fork" the missing Nano into a new cryptocurrency that would fairly compensate the class victims.

 

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