Block.one ERC-20 Tokens and EOS $22 Million Settlement
Block.one settled $22 million with US-based purchasers of EOS or ERC-20 tokens to end claims over selling unregistered securities in the USA.
From June 26, 2017, Block.one, its Leaders, and Insiders promoted, offered and sold unregistered security called EOS or ERC-20 tokens throughout the United States, in violation of federal and state securities laws.
On September 30, 2019, the SEC found that Block.one had violated the Securities Act by selling EOS to the public. As a result of an SEC enforcement action, Block.one was required to pay a $24 million fine.
In April 2020 class action against Block.one alleged that the company engaged in unregistered trading of securities, misleading of investors, and improperly funneling funds to its trading arm in Hong Kong.
In June 2021, a proposed settlement of $27.5 million was agreed. The deal was intended to resolve investors’ allegations that Block.one sold unregistered securities in a 2017 offering.
On August 15, 2022, U.S. District Judge Lewis Kaplan of Manhattan refused to grant final approval of the proposed $27.5 million settlement. The judge concluded that the investor class is inherently conflicted because some tokenholder purchases are covered by U.S. laws but others are not. Kaplan said that the lead plaintiff in the class action, Crypto Assets Opportunity Fund LLC, could not adequately represent the interests of investors whose transactions took place in the U.S. because the fund also engaged in foreign Block.one token transactions.
Taking into account that the settlement has already been agreed by parties, and the refusal of the final approval is a more bureaucratic and solvable issue, then the affected investors most likely have the opportunity to initiate a new Case and receive due compensation.
Frequently Asked Questions
All persons or entities who, at any time during the period of June 26, 2017 through May 18, 2020, inclusive, acquired ERC-20 Tokens or EOS Tokens in a Domestic Transaction and were damaged thereby.
No, if you have purchased securities within the class period, you are eligible to participate.
You can participate in the settlement and retain (or sell) your securities.
The entire process usually takes 4 to 9 months after the claim deadline. But the exact timing depends on the court and settlement administration.
The final payout amount depends on your specific trades and the number of investors participating in the settlement.
If 100% of investors file their claims - the average payout will be $0.02 per share. Although typically only 25% of investors file claims, in this case, the average recovery will be $0.08 per share.
11thestate is an investor recovery company, we help investors to track and collect securities class action settlements. We will:
1. Prepare documents for your payout
2. Audit the claim and make sure you get the maximum possible payout
3. File a claim with the settlement administration
4. Correspond with the settlement administration to resolve emerging issues
5. Deliver payout directly to your brokerage account
There is no upfront cost, but we will deduct 20% of the recovered amount as a commission for our services.