"Make Fiat Great Again"

Terraform Labs, Founder, VC Firms Sued on Claims That Investors Were Misled

An Illinois resident sued Terraform Labs, its founder Do Kwon and several VC firms that make up the Luna Foundation Guard (LFG) on claims the defendants violated federal securities laws and misled investors.

The plaintiff, Nick Patterson, filed a lawsuit seeking class action status on Friday in the Northern District of California in the hopes of recouping losses and any injunctive or punitive fees from a jury trial.

Can ESG-Motivated Company Actions Lead to Corporate and Securities Litigation?

ESG is a hot topic. There is a general perception in certain circles – including the D&O insurance community — that ESG awareness and activism are essential attributes of good corporate citizenship. There is even a perception in certain parts of the D&O insurance community that strong ESG credentials makes individual companies better D&O risks. However, as the securities class action lawsuit recently filed against U.K consumer products company Unilever shows, activism on ESG issues can, in fact, lead to D&O claims. The complaint in the Unilever action, which makes for interesting reading and arguably has important implications, can be found here.

Alex Mashinky’s Celsius crypto bank draws probe by five states

As a private unregulated company, Celsius does not come under any requirement for disclosure. Mashinsky has said the company is simply lending the crypto to investors willing to pay a premium for it. Critics including Klippsten say it has more likely been taking risky bets with that cash in a host of volatile coins and funds.

That can work, they say, when a bull market keeps the company’s own returns high and depositors’ demand for cash low. But when the market crashes, as it has over the past month, the value of Celsius’s holdings plummet at the same time that a lot of people want their money out.

FTX, other crypto firms ditch sports deals as market collapses

Crypto exchange FTX — which shelled out $135 million to rename the home of the Miami Heat in March 2021 — pulled out of talks to provide a jersey patch to the MLB’s Los Angeles Angels in recent weeks as the crypto market tanked, sources with direct knowledge told The Post.

Another patch deal between the NBA’s Washington Wizards and a crypto company also recently fell through, the sources said.

Both deals were nixed as the market crumbled, the sources said. The Washington Wizards patch had been seen as particularly desirable for crypto companies since the politicians and regulators who oversee the space attend their games.

Terraform: crypto collapses lessen pressure on banks and regulators

For traditional finance, crypto woes could not have materialised in a handier form. They have disproved claims that prices were uncorrelated to conventional assets. They have shown that investors can easily lose their shirts. And they have had little spillover because the sector is still relatively unconnected and small. For example, the total value of stablecoin assets of around $190bn is less than one per cent of the $50tn market value of US equities.

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In the aftermath of the current shakeout, financial watchdogs around the world will need to carve regulated territory from the crypto badlands. Resistance should be helpfully low.