Tezos Settles Class Action Lawsuit of $232M ICO for $25 Million

The class-action lawsuit alleging that Tezos violated securities laws in its 2017 ICO has settled after battling for 3 years.

By · Sep 1, 2020 . 5min read

Tezos Settles Class Action Lawsuit

A long-running lawsuit alleging the Tezos initial coin offering (ICO) raised $232 million in 2017 was an unregistered securities sale that has been settled. The three-year-long class action lawsuit targeting Tezos (XTZ) has concluded after Judge Seeborg approved Tezos’ $25 million settlement on Friday.

According to August 28 judgment, the judge ordered that the funds from the settlement should be distributed among “all persons and entities” who participated in the blockchain project’s initial coin offering (ICO). It also includes the entitled who sold their tokens for a loss before November 25, 2019, or still holding the tokens or even lost passwords of their wallets.

All the parties need to file for a claim for their settlement before October 16. The plaintiff’s counsel will receive a fee equal to a third of the settlement amount. Besides, it will receive around $203,000 in litigation fees as a payment separately. Nevertheless, the court excluded the defendants, Tezos founders’ family, and anyone with a position on the company from receiving the settlement proceeds. Judge Seeborg described the agreement as “fair, reasonable, and adequate”. He further noted that the case involved cutting edge litigation that addressed novel problems.

More about the unregistered Tezos ICO

Tezos has developed a proof-of-stake blockchain and raised $232 million in 2017 via an ICO. However, the project soon faced resentment from the investors. This resulted in filing lawsuits against Tezos ICO. The ICO investors claimed that the company violated the US securities laws by providing unregistered securities. The blockchain company already approved its decision to settle with the investors earlier this year. However, its details were unknown then. The company justified the settlement citing time and expenses incurred through the lengthy legal battle.

Earlier, we reported that Tezos, a famous liquid proof of stake cryptocurrency network, has integrated with Harbinger price oracles. The integration may be a giant evolution in the DeFi ecosystem. Harbinger is a project that delivers signed price feeds based on real-time market data from various exchanges.

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