The co-lead counsel of the embattled cryptocurrency exchange FTX has voluntarily dismissed popular crypto influencer Ben Armstrong, widely known as BitBoy, from the ongoing legal case. This development comes as part of a broader effort to reclaim funds that were donated to celebrities, influencers, athletes, and sports teams before FTX’s unfortunate collapse in November.
Background: FTX’s Legal Battle
FTX’s downfall prompted investors to initiate legal action against various high-profile figures who had received payments from FTX’s management, led by Sam Bankman-Fried (SBF), to endorse the cryptocurrency platform. Allegations centered around the promotion of what was believed to be a fraudulent scheme to exploit retail investors with limited knowledge of the crypto space.
Prominent personalities like basketball legends Shaquille O’Neal and Steph Curry, tennis sensation Naomi Osaka, NFL superstar Tom Brady, and franchises like the Miami Heat and Golden State Warriors from the NBA and MLB, all found themselves named as defendants in the case. Additionally, well-known YouTube influencers BitBoy, Kevin Paffrath, and Tom Nash were implicated.
BitBoy’s Dismissal: Lack of Response
In a recent development, BitBoy has been dismissed from the lawsuit by FTX’s co-lead counsel. The decision to drop the charges against him was primarily due to his failure to file a response to the allegations or seek summary judgment. This move underscores the complex and evolving nature of the legal battle surrounding FTX.
Aside from BitBoy’s dismissal, FTX’s co-lead counsel also disclosed that they have entered into proposed settlement agreements with three other notable defendants. These include Trevor Lawrence, the quarterback for the NFL’s Jacksonville Jaguars, as well as YouTube influencers Kevin Paffrath and Tom Nash. The settlements aim to resolve the claims that these individuals played a role in deceiving FTX investors.
Further Settlement Discussions in Progress
In a promising development, FTX’s legal team is currently in discussions with more defendants who have expressed a willingness to engage in mediation once they are formally dismissed from the lawsuit. The potential for settlements is high, and dates have already been reserved for mediation sessions in October and November, presided over by Judge Michael Hanzman (ret.). The expectation is that these discussions will lead to further resolutions.
As the legal battle surrounding the collapse of FTX continues to unfold, the dismissal of BitBoy and the proposed settlements with other defendants signal a significant shift in the case. Investors, celebrities, influencers, and athletes are all closely watching the proceedings, as the outcome of these legal actions could have far-reaching implications for the world of cryptocurrency endorsements and investments. The evolving story of FTX serves as a cautionary tale for all stakeholders in the rapidly evolving and often unpredictable crypto landscape.