Lawsuit Alleges $250 Million Israeli ICOs to Be Scams
- The plaintiffs are now seeking $16.1 million in damages for their investment in these ICOs.
Three Israeli companies, Sirin Labs, Stx Technologies Limited (Stox), and Leadcoin, are facing a lawsuit with allegations of initial coin offerings (ICO) scams involving around $250 million, The Times of Israel reported.
The companies took the ICO route to raise massive capital during the hype between 2017 and 2018. Sirin Labs raised $158 million in July 2017 to build a secure Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term-based smartphone; Stox, a sports and current events prediction market, secured $34 million in the same year; and Leadcoin banked $50 million the following year for a decentralized lead sharing network.
The lawsuit was filed by Roee Brocial and Eran Okashi, two former employees of the Singulariteam venture capital fund, on May 25. They are seeking $16.1 million from Moshe Hogeg, Adi Sheleg, Ido Sadeh Man, Yaron Shalem, Shmuel Asher Grizim, Avishai Ziv (Sonenriech), Singulariteam Holding II and Singulariteam Ltd.
Hogeg, who is the Co-Founder of both Stox and Sirin Labs, owns 70 percent of Singulariteam, while Sheleg, Sadeh, and Shalem, hold 22.5 percent, 5 percent, and 2.5 percent in the company, respectively. Ziv is Singulariteam CEO. Grizim is the Founder and CEO of Leadcoin and heads Webydo Systems, another Israeli company.
Initially, the two plaintiffs were convinced with the proposals of the blockchain firms and invested their own money in the three companies. In addition, they persuaded family and friends to invest in the ICOs.
However, now they are alleging that neither of the companies is building any products and the ICOs were outright scams. Moreover, the lawsuit alleged that the defendants misappropriated the ICO proceeds for personal use.
Do Celebrity Endorsements Mean Anything?
Hogeg is known for onboarding high-profile celebrities to promote and invest in his startups. Stox ICO was endorsed by American boxer, Floyd Mayweather while star Lionel Messi and supermodels Irina Shayk and Sara Sampaio promoted Sirin Labs.
He faced multiple lawsuits earlier for his blockchain startups, but all of them were settled privately with non-disclosure agreements in place.
“The defendants understood the advantages and the potential inherent in raising money through initial coin offerings, especially the lack of oversight and Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term in this area,” the lawsuit stated.
“Soon after they raised money and sometimes while they were doing so, the defendants emptied the companies and left them without any substantial activity, leaving investors with huge losses.”
Hogeg, who also owns the Beitar Jerusalem football team, talked with local publication Walla and denied all allegations against him.
Three Israeli companies, Sirin Labs, Stx Technologies Limited (Stox), and Leadcoin, are facing a lawsuit with allegations of initial coin offerings (ICO) scams involving around $250 million, The Times of Israel reported.
The companies took the ICO route to raise massive capital during the hype between 2017 and 2018. Sirin Labs raised $158 million in July 2017 to build a secure Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term-based smartphone; Stox, a sports and current events prediction market, secured $34 million in the same year; and Leadcoin banked $50 million the following year for a decentralized lead sharing network.
The lawsuit was filed by Roee Brocial and Eran Okashi, two former employees of the Singulariteam venture capital fund, on May 25. They are seeking $16.1 million from Moshe Hogeg, Adi Sheleg, Ido Sadeh Man, Yaron Shalem, Shmuel Asher Grizim, Avishai Ziv (Sonenriech), Singulariteam Holding II and Singulariteam Ltd.
Hogeg, who is the Co-Founder of both Stox and Sirin Labs, owns 70 percent of Singulariteam, while Sheleg, Sadeh, and Shalem, hold 22.5 percent, 5 percent, and 2.5 percent in the company, respectively. Ziv is Singulariteam CEO. Grizim is the Founder and CEO of Leadcoin and heads Webydo Systems, another Israeli company.
Initially, the two plaintiffs were convinced with the proposals of the blockchain firms and invested their own money in the three companies. In addition, they persuaded family and friends to invest in the ICOs.
However, now they are alleging that neither of the companies is building any products and the ICOs were outright scams. Moreover, the lawsuit alleged that the defendants misappropriated the ICO proceeds for personal use.
Do Celebrity Endorsements Mean Anything?
Hogeg is known for onboarding high-profile celebrities to promote and invest in his startups. Stox ICO was endorsed by American boxer, Floyd Mayweather while star Lionel Messi and supermodels Irina Shayk and Sara Sampaio promoted Sirin Labs.
He faced multiple lawsuits earlier for his blockchain startups, but all of them were settled privately with non-disclosure agreements in place.
“The defendants understood the advantages and the potential inherent in raising money through initial coin offerings, especially the lack of oversight and Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term in this area,” the lawsuit stated.
“Soon after they raised money and sometimes while they were doing so, the defendants emptied the companies and left them without any substantial activity, leaving investors with huge losses.”
Hogeg, who also owns the Beitar Jerusalem football team, talked with local publication Walla and denied all allegations against him.