ENF Rejects $22 Million Settlement from Block.one, Claims Inadequate Compensation for Users
The EOS Network Foundation (ENF) has urged members of the EOS blockchain community to decline a $22 million settlement offered by Block.one. According to ENF, the proposed settlement fails to sufficiently compensate users for their losses resulting from Block.one’s misrepresentations. Furthermore, accepting the terms would prevent victims from pursuing further legal action against the company in the future. ENF emphasizes that a large number of refusals would send a strong message.
Key Points:
– ENF argues that the $22 million settlement offer is unfair given that Block.one raised $4 billion through its initial coin offering (ICO).
– The settlement offer covers the losses of ERC-20 and EOS token holders between June 26, 2017, and May 18, 2020.
– Block.one did not fulfill its promise to invest $1 billion in the EOS network and its community.
– The company claims it has no legal obligation to fulfill its promise and its shareholders received significant returns during a buyback.
The final date for responding to the settlement proposal is August 29. Victims who do not respond will lose the opportunity to pursue legal action against Block.one in the future. A recent court ruling in New York classified token sales to institutional investors as securities offerings, while those sold to retail investors were not considered securities.
Block.one initially raised $4 billion through its ICO, positioning EOS as a competitor to Ethereum. However, instead of focusing on developing the blockchain, the company invested in a social media company called Voice and a centralized crypto exchange called Bullish. The EOS blockchain has faced criticism for its lack of decentralization, poor governance, and limited development activity. In response, Yves La Rose founded the EOS Network Foundation in 2021 to pressure Block.one into investing in development. The community froze the founders’ token vesting contract and forked the blockchain code to make it open-source.
Hot Take
The rejection of the $22 million settlement by the EOS Network Foundation reflects the dissatisfaction among EOS blockchain community members regarding Block.one’s actions. By refusing the settlement and highlighting the company’s failure to deliver on its promises, victims hope to call attention to the need for accountability and fair compensation. This case serves as a reminder of the importance of due diligence and transparency in the crypto industry.
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