Mark Cuban, the billionaire entrepreneur who has been quite active in the crypto ecosystem for the past year, is facing a class-action lawsuit over his promotions of the bankrupt crypto brokerage firm Voyager Digital.
The Moskowitz Law Firm filed a civil suit in the United States District Court in Southern Floridaย against Cuban for promoting Voyagerโs unregulated crypto products. The lawsuit demanded a jury hearing for the case.
The lawsuit alleged Cuban also misrepresented the firm on numerous occasions, making dubious claims of it being cheaper than competitors and offering โcommission-freeโ trading services. Cuban, along with Voyager Digital CEO Stephen Ehrlich, leveraged their years of experience to lure inexperienced customers into investing their life savings in what they called a Ponzi Scheme, the lawsuit alleges
An excerpt from the lawsuit read:
โCuban and Ehrlich, went to great lengths to use their experience as investors to dupe millions of Americans into investingโin many cases, their life savingsโinto the Deceptive Voyager Platform and purchasing Voyager Earn Program Accounts (โEPAsโ), which are unregistered securities.โ
The lawsuit further alleged that Cuban continued to hype Voyagerโs products and push retail investors to invest in it despite knowing it. Cuban went on record calling the Voyager platform โas close to risk-free as youโre gonna get in the crypto.โ The lawsuit read:
โVoyager Platform relied on Cubanโs and the Dallas Maverickโs vocal support and Cubanโs monetary investment in order to continue to sustain itself until its implosion and Voyagerโs subsequent bankruptcy.โ
Voyager was one of many crypto lenders to Three Arrows Capital (3AC) that went bust after laters insolvency. The crypto lending firm paused trading activity and withdrawals on July 1ย and eventually filed for chapter 11 bankruptcy on July 5. Currently, over 3.5 million American customers have nearly 5 billion dollars in cryptocurrency assets on the platform frozen.
Related: Voyager Digital reportedly had deep ties with SBF-owned Alameda Research
Voyager was cleared to return $270 million in customer funds held at the Metropolitan Commercial Bank (MCB) by the judge presiding over its bankruptcy proceedings in New York. A day later, the lending firm announced that clients with U.S. dollars in their accounts could withdraw up to $100,000 in a 24-hour period starting as early as Aug. 11, with the funds received in 5โ10 business days.
