Lawsuit Against ICO Promoted by Floyd Mayweather and DJ Khaled
Controversial boxing icon, Floyd Mayweather finds himself in an awkward position as Centra Tech, the company behind a cryptocurrency-based debit card, finds itself a defendant in a class action lawsuit filed this week in the state of Florida.
Mayweather himself is not named among the defendants; however, he was a well-known supporter of the project and even posted a Twitter status featuring the Centra card. The boxer claimed to be using the card to, quote:
Spend bitcoins, ethereum and other types of cryptocurrency in Beverly Hills.”
The project was also supported by DJ Khaled, a New Orleans based entertainer, along with several other celebrities.
Complaints Against Centra and other Defendants
The complaint relates to Centra’s crowd sale which occurred between approximately July 30, 2017 and October 5, 2017. During this period, the fundraiser obtained over $30 million worth in digital currency, given in exchange for Centra Tokens (CTR), the project’s utility token.
According to the complaint draft, the Centra team claimed to be using its ICO funds to facilitate the creation of a blockchain-based debit card that would be usable on both the Visa and Mastercard payment channels, along with a massive online marketplace and even a dedicated blockchain.
The plaintiffs believe Centra misrepresented the project’s utility tokens as securities or investments, meaning they should fall under the regulatory oversight of the United States Security and Exchange Commission (SEC) which doesn’t currently regulate these types of transactions.
Centra’s founders, Sohrab Sharma and Raymond Trapani, are co-defendants in the litigation. Both have already left the project. Centra disputes the allegations made against them, but there has not yet been any word from the two co-founders or representatives of Mayweather or DJ Khaled.
Image From Shutterstock