Celsius countersues KeyFi, claims deceit and incompetence led to tens of millions in losses

Bankrupt crypto lending firm Celsius countersued decentralized finance (DeFi) protocol KeyFi and its CEO Jason Stone on Tuesday in the USA Chapter Court docket claiming Stone misrepresented himself as an skilled in DeFi, and that Stone and KeyFi hadlost Celsius cash by way of incompetence and deceit. The go well with got here a number of weeks after KeyFi sued Celsius for allegedly failing to honor a profit-sharing settlement. 

KeyFi supplied Celsius with staking companies and DeFi technique. In accordance with the Celsius go well with, the defendants allegedly stole tens of millions of {dollars} in cash from Celsius wallets. Additional, Celsius alleges that the defendants purchased nonfungible tokens (NFTs) with Celsius cash with out Celsius’ authorization after which transferred them to their very own wallets earlier than promoting some for “seven determine returns (which they pocketed).” The defendants additionally allegedly purchased an curiosity in different crypto firms with Celsius cash and used Twister Money, the crypto privateness protocol not too long ago banned by the U.S. Treasury Division, to cover their actions.

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Celsius KeyFi was a co-plaintiff within the go well with. It was a particular objective car owned by Celsius that KeyFi labored inside. The plaintiffs claimed they’d misplaced “many tens of tens of millions of {dollars}” by way of the defendants’ gross negligence and probably tens of tens of millions of {dollars} from transformed property. Additional, they claimed that KeyFi did not return funds when requested to take action and made frivolous claims in opposition to Celsius and tweeted about it:

“As Stone clearly meant, the criticism and Twitter thread generated sensational media reviews amplifying his false narrative.”

KeyFi sued Celsius on July 7 alleging that Celsius did not honor a “handshake settlement” to share earnings after KeyFi’s staking and DeFi strategizing actions. KeyFi claimed the settlement was value tens of millions of {dollars} and Celsius operated as a Ponzi scheme. Celsius had suspended withdrawals on June 13 and was reportedly bancrupt when KeyFi sued it. Celsius filed for chapter every week later.