The cryptocurrency law firm of Nadrich & Cohen is actively representing those who have lost money due to bad behavior by cryptocurrency exchanges, such as misrepresenting financial strength and downplaying risk.
Small and large investors have lost digital assets worth billions of dollars in recent times. For example, Sam Bankman-Fried and his cryptocurrency exchange FTX have been the subject of worldwide headlines as they have spiraled into bankruptcy, as well as possibly criminal charges.
However, problems in the cryptocurrency and blockchain world extend far past FTX. Nadrich & Cohen is investigating how numerous platforms have exaggerated their companies’ financial strengths while hiding the risks associated with them from their investors. Investors might pay hefty prices if cryptocurrency exchanges misrepresented investments. These companies face intense scrutiny by regulatory agencies and cryptocurrency lawyers.
Call us now or text us from this page if you or a loved one lost money due to the bad behavior of a cryptocurrency exchange. A cryptocurrency lawyer at our firm will give you a free consultation and help you navigate through the legal world of cryptocurrency’s emerging technologies. We won’t charge you a fee until and unless we obtain compensation for your losses.
FTX is a cryptocurrency exchange which let customers engage in digital currency trades and transfers using blockchain technology. The exchange let customers exchange digital currency for conventional currency or different cryptocurrencies.
There are accusations that FTX embezzled the assets of customers, used customers’ assets illegally, and have run afoul of securities laws. FTX may have also violated tax law, as FTX currently owes money to the IRS as well as the Financial Crimes Enforcement Network. Bankman-Fried is facing charges of securities fraud, wire fraud, lying to his investors and more. Bankman-Fried has also reportedly been accused of running afoul of anti-money laundering laws.
Those who invested in FTX have suffered losses of billions of dollars. FTX’s collapse has created disruption and enormous concerns regarding other crypto exchanges and if those exchanges also lied to their customers.
Click here for more information about FTX lawsuits.
Genesis Trading And Gemini Earn
Gemini is a cryptocurrency exchange offering a product known as Gemini Earn. Gemini Earn let lenders provide loans for institutional partners. Gemini Earn, according to allegations, advertised that its investors could profit by earning interest on cryptocurrency they lent to others.
However, lawyers investigating Gemini allege that Genesis, a lending partner of Gemini’s, lacked financial soundness and was a lot riskier than they were represented as being.
Genesis filed for bankruptcy protection in January and has frozen every Gemini Earn account, leading to almost $1 billion worth of digital asset losses.
Genesis is facing legal issues because they are accused of misrepresenting facts about the strength of its finances and the risks associated with it, and wrongly freezing withdrawals from accounts. Gemini is accused of failing to protect customers in numerous ways, such as by not adequately auditing the condition of Genesis’ finances before making Genesis its partner in lending.
Click here for more information about Gemini Earn lawsuits.
Genesis Faces Legal, Securities And Exchange Commission Issues
The Commodity Futures Trading Commission, in June 2022, announced it was filing a complaint against Genesis, stating that Genesis made misleading or false statements to the commission, or omitted facts from the commission, in relation to self-certifying a product relating to bitcoin futures.
Gemini is now the subject of a class action lawsuit which alleges that the exchange sold accounts bearing interest without registering the accounts as securities.
Bittrex is a crypto trading platform which shut down in the U.S. in April 2023. The reason for the shutdown was cited as being cryptocurrency laws which are too vague. Bittrex’s assets and liabilities are worth between $500 million and $1 billion, according to a bankruptcy filing.
A lawsuit has been filed by the SEC against Bittrex. The lawsuit claims Bittrex operated as an unregistered broker, agency and exchange.
Click here to read more about Bittrex.
What Is Cryptocurrency?
Cryptocurrency entered the public consciousness in 2009 when Bitcoin was created. Crypto threatened to reduce the banking power of institutions and decentralize the entire financial system.
Since the introduction of Bitcoin, crypto’s market has seen exponential growth. Thousands of cryptocurrencies exist today. Some cryptocurrencies, like Bitcoin, are used in many types of financial transactions. Other cryptocurrencies’ applications are of the niche variety.
- Crypto is digital currency. No physical bill or coin exists.
- Go-between institutions like banks aren’t required for crypto transfers. It is received, sent and stored using digital wallets.
- Crypto isn’t backed by governments. It isn’t protected by governments, so it isn’t protected by things like deposit insurance.
- Crypto is sold and bought on currency exchanges such as Coinbase, Binance, Gemini and Kraken.
- Almost anyone can create cryptocurrencies.
What Nadrich & Cohen Is Doing For Those Who Lost Digital Assets
Nadrich & Cohen is performing investigations into possible arbitration claims and litigation against major cryptocurrency companies as well as individuals who promoted and ran the companies. If you have lost money regarding your cryptocurrency investment (cryptocurrency, crypto staking, crypto loan, crypto token, etc.), please call us today for a free, confidential consultation so we can learn about your circumstances and make a determination as to if we can accept your case.
Wrongful Crypto Account Freezes
One way that cryptocurrency owners commonly lose money is when their crypto accounts are wrongfully frozen.
These freezes happen for a variety of reasons, but it is always frustrating for account owners when they happen because the freezes prevent them from executing trades and liquidating their assets. Nadrich & Cohen is actively representing those who have suffered from cryptocurrency account freezes, helping them regain assets.
Cryptocurrency Scams And Volatility
While crypto is virtual money, devaluation of cryptocurrency and crypto fraud can absolutely result in the loss of real currency.
One of crypto’s defining aspects is extreme, sudden fluctuations in price. The value of a virtual coin can fluctuate drastically by the hour.
The price of Bitcoin fell by over 76 percent in 2018, then increased by over 15 percent in one day the following year. This led to $14 million worth of additional market value in a single day.
Later that year, the price of Bitcoin reached almost $14,000, only to crash down to $7,500 in a few months.
Fluctuations like these are normal. The value of Bitcoin was once $1,000 in 2017, but in December 2017 it was almost $20,000. Its value was then less than $8,000 just two months afterwards. A lot of people suspect that cryptocurrency prices are manipulated illegally by those who invest heavily in them.
Cryptocurrency is a popular target for fraudulent schemes intended to make a profit by taking advantage of investors. $9 million per day is lost to crypto scams. Common crypto scams include:
- Fraudulent wallets and exchanges: Hundreds of crypto exchanges exist. Fake exchanges, unfortunately, are quite common, as are fake wallets, which can be clones of legit wallets.
- Initial coin offering fraud: Initial coin offerings (ICOs) allow companies or individuals to raise funds for new cryptocurrencies by offering virtual coins in exchange for real currency. Those who commit fraud might tout ICO “investment opportunities” which are simply scams to steal digital wallets or coins.
- Phishing: Hackers attempt to obtain crypto investors’ personal information in order to steal their cryptocurrency, often using tactics such as fake Airdrops.
- Ponzi schemes: These schemes have been around since the 1920s, and are now seen in the cryptocurrency world.
- Impersonation: Fraudsters create fake accounts on social media sites which impersonate genuine cryptocurrency executives or businesses, and use these accounts to compromise or defraud others. Fraudsters might also pretend to be support staff for cryptocurrency exchanges.
- Pump And Dump Schemes: An old trick regarding the stock market is to drive the price of stock up, then sell off your holdings at an artificially-created peak. In the cryptocurrency world, this type of scheme is common at the stage of ICOs or later, whenever demand can be hyped up by false claims, allowing those holding the cryptocurrency to earn huge, phony profits.
Crypto Theft Lawyer
Hackers and fraudsters are increasingly finding ways to steal cryptocurrency from investors. Crypto.com had a hacker steal $30 million worth of crypto from almost 500 users’ wallets. Wormhole had a hacker steal $320 million worth of digital assets.
Cryptocurrency exchanges have a duty to provide their customers with adequate security which protects them from hackers and fraudsters. If you have had your crypto assets stolen due to inadequate security, you may be able to recover financial compensation from the crypto exchange who negligently failed to adequately secure your assets.
SIM Card Hacks
A customer of T-Mobile lost $8.7 million worth of cryptocurrency when the company allowed a hacker access the customer’s account multiple times. Prior to this occurring, the Federal Trade Commission warned about the possibility of fraud regarding cell phone service providers, a type of fraud known as SIM swap scams or SIM card swap hacks.
The way SIM card hacks work is as follows:
- A hacker makes contact with your cellular service provider and manipulates them into switching your phone number to a SIM card under their control
- The hacker can now receive texts and calls that are meant for you – including crypto account access codes
- The hacker receives crypto account access codes using the SIM card to access and take money from your crypto accounts and bank
When this occurs, it’s likely that your cell phone service provider violated federal law when they gave the hacker your information. In this case, you may be able to seek financial compensation from your cell phone service provider in a SIM card hack lawsuit.
Mishandling Of Cryptocurrency Funds
Parties involved in cryptocurrency transactions sometimes lose cryptocurrency. This has occurred in many high-profile instances, such as scandals involving Mt. Gox as well as individuals who were careless regarding computer equipment.
You may have entrusted cryptocurrency to a crypto exchange which lost it. You may have been involved with a transaction involving a loss of your cryptocurrency by an escrow agent. You are entitled to attempt to recover losses when you trust others to hold onto valuable assets.
However, blockchain ledgers work in unusual ways, and digital currency involves anonymity features which are built in. Because of this, it can be tough to prove that another person had custody of your funds. That being said, transaction evidence can still be discovered by investigating blockchain ledgers, investigating correspondence such as emails, and consulting with expert witnesses.
How Much Does A Cryptocurrency Lawyer Cost in California?
Nadrich & Cohen is handling crypto cases on a contingency fee basis. This means that you will not be charged a fee if we don’t recover financial compensation for you.
You will only be charged a fee once we obtain a recovery for you, and that fee will simply be a percentage of the compensation we recover for you.
You will never owe us any upfront fee or any money out of your own pocket.
Crypto Lawsuit Updates
In May 2023, the Judicial Panel on Multidistrict Litigation was told by a plaintiff’s lawyer that, despite objections over claims not overlapping, investor litigation regarding FTX’s collapse should undergo consolidation in Florida.
The JPML, on May 25, 2023, will hear arguments regarding the consolidation of plaintiff actions. The arguments will be regarding litigation of the 2022 collapse of cryptocurrency exchange FTX. Plaintiffs have requested consolidation regarding seven actions. They are asking for the actions to be consolidated in the United States District Court for the Southern District of Florida. The district also maintains a couple of pending class actions against FTX which were previously consolidated. These class actions named FTX executives and “insiders” as defendants, in addition to brand ambassadors such as Steph Curry, Shaquille O’Neal, Tom Brady and Larry David. FTX’s meltdown is described by the consolidation proposal as “the largest financial fraud in US history.” The proposal describes “unprecedented” fraud which caused investors around the world billions in crypto losses. It is expected that the case will be consolidated because of the large number of affected investors.
On April 17, 2023, The SEC filed a lawsuit against Bittrex alleging that the crypto trading platform was operating as an broker, exchange and clearing agency for securities. The lawsuit alleges that Bittrex knew it was allowing securities to be bought, sold and traded on its platform, knew it should have registered with the SEC because of this, and, instead of registering, engaged in a campaign consisting of asking issuers of securities that it allowed the buying, selling and trading of on its platform to remove from the internet any statements implying their products were securities.
On February 10, 2023, plaintiffs filed a request with the JPML. They requested that the increasing number of lawsuits over the collapse of FTX be consolidated before a single judge so pretrial proceedings can be coordinated. The cases allege their crypto assets were stolen and that they were blocked from withdrawing their assets.
Cryptocurrency Lawyers in California
If you have suffered cryptocurrency losses due to the negligence or fraud of others, you may be eligible for financial compensation in a crypto lawsuit. Nadrich & Cohen is dedicated to helping those who have suffered losses due to cryptocurrency exchanges’ actions and are committed to making sure that you obtain the financial compensation you deserve.
Our experienced lawyers possess extensive knowledge regarding cryptocurrency laws and have successfully obtained financial compensation for clients in a wide variety of situations. We and our partners possess expertise regarding areas such as securities and commodities laws, blockchain technology, corporate and securities laws, smart contracts, intellectual property and cybersecurity. We understand these complex cases and possess a commitment to utilizing our expertise in order to fight for your legal rights.
Whether you suffered losses due to fraud, misrepresentation, hacking, a security breach or another issue, we’re here to assist you. Our team of lawyers will advise clients of their legal options, tirelessly work to protect your rights and obtain for you the compensation you deserve if you have invested in Bitcoin or other digital assets.
Don’t hesitate to seek well-deserved justice. If you suffered a cryptocurrency-related loss, call us today for a free, confidential cryptocurrency lawsuit consultation. Our experienced lawyers have recovered over $350,000,000 for our clients since 1990. We are here to assist you and will fight to make sure your rights get protected through every step of the legal process.
We have decades of experience and are committed to helping those affected by crypto exchanges’ actions. We can provide you with the representation and legal support that you need in order to succeed.
Call us now to learn more regarding how we can assist you.