One of the largest crypto exchanges in the industry, Crypto.com is facing legal action from a crypto startup after it fell victim to a scam.
A lawsuit was filed against the crypto exchange in a Florida court by Glow Token LLC in which Crypto.com has been accused of breach of contract.
The damage claim of $250,000 has been filed, even though it has also been acknowledged that the exchange may not have had any involvement in the fraud.
The scam
Bryan Lawrence, the chief executive of Glow Token, had been approached earlier this year by individuals who identified as employees of Crypto.com.
They talked to the CEO about listing his token on the crypto exchange. For months, they continued to negotiate and exchange documents.
Eventually, Lawrence made a transfer of funds to an account he believed belonged to Crypto.com. But, he was informed by officials of the exchange in March that he had been scammed by impostors.
According to Crypto.com, they had not signed any listing agreement with Glow Token and asked the CEO to stop making any claims relating to it.
Meanwhile, Lawrence continued to insist that he had made a legitimate deal with the crypto exchange.
The CEO
Lawrence announced the lawsuit in a letter and said that he had done his due diligence and every step had been directly verified with Crypto.com.
He said that he had checked the listing link on the exchange’s website, confirmed the contact information he had been given, went over all the emails he had received, and also accessed the communication platform that had been required.
In fact, he had also gone over the actual listing contract carefully and several representatives of the crypto exchange had verified all the details.
Lawrence is now looking for a remedy, after having transferred a sum of $250,000 to the scammers, along with a 1 BTC, which had been valued at $23,000 at that time.
He also claims that the logs of the online chats he had with representatives of Crypto.com had been deleted.
He stated that he had copied the conversations, which is a part of verification, and had then contacted his law firm to get assistance in resolving the situation.
The filing
According to the court filing, the CEO had launched his firm to give back to the community and for charity purposes.
He also wants to spread awareness about the positive aspects of DeFi i.e. decentralized finance and has taken a position to combat the ‘bad actors’ that have become part of the crypto space.
The chief executive has asserted in the said filing that his reputation in the crypto community is excellent and he was on the cusp of becoming an industry leader in the industry and community.
Now, both his finances and health have taken a hit. Due to stress, he has been hospitalized four times and is suffering from stomach issues.
He also revealed that he had had to sell his home to cover the legal costs to reach a resolution in this matter.