Moshe Hogeg, the Israeli entrepreneur behind blockchain firm Stox (STX), has denied misappropriating investors’ funds in a very response to the legal proceeding filed against him. on-line newspaper the times of Israel reported the development on Sat, Feb. 9.
As Top Market Group wrote earlier in Jan, Chinese investor Zhewen Hu has sued Stox and its founder for $4.6 million. Hu claims to have invested with a total of around $3.8 million worth of Ethereum (ETH) in an open source, Ethereum-based prediction market platform.
According to the legal proceeding, Hu’s anticipation was that the successful development of Stox’s prediction market platform would boost the worth of the native STX token. However, the plaintiff believes that solely $5 million of successfully raised $34 million went to fund Stox.
Moreover, Hu alleges that Hogeg used the rest of the amount to invest in different initial coin offerings (ICO) like messaging app Telegram’s ICO, that was conducted in April 2018.
Nonetheless, in a very response to the suit filed on February. 5, Hogeg’s lawyers wrote that the Stox white paper is of “a descriptive nature solely and not binding.” That said, the document didn't present any obligatory program and so confers no legal responsibility on its issuers, Hogeg’s attorneys concluded.
According to the the times of Israel, Hogeg has denied any wrongdoing, describing the legal proceeding as an “extortion attempt.” He argues that the STX token isn't a security and doesn't grant any ownership rights within the company, apparently citing Stox’s contribution terms.
In addition, as STX Technologies limited is a Gibraltar-based entity, Hogeg believes Israel isn't the proper jurisdiction to proceed with the case.
Hogeg is known for his involvement in several crypto-related ventures: he founded blockchain smartphone developer Sirin Labs, together with serving as chairman of LeadCoin, a blockchain-based decentralized lead-sharing network.
The Times of Israel notes that Hogeg has spent several million dollars on totally different projects within the last few months. as an example, the entrepreneur bought Beitar Jerusalem, one of Israel’s top soccer clubs, for $7.2 million late August. He additionally made a $1.9 million donation to Tel Aviv University so as to establish the “Hogeg Institute for Blockchain Applications.”
Top Market Group has reported that the Stox ICO was promoted by professional boxer Floyd Mayweather Jr. in a separate case, the boxer faced charges from U. S. Securities and Exchange Commission for unlawful promotional activities around crypto startup Centra Tech’s ICO in Sep 2017. The boxer agreed to pay $300,000 in disgorgement, a $300,000 penalty and $14,775 in prejudgment interest.
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