A US court has frozen the assets of BitConnect

A US court has frozen the assets of BitConnect

A US court has imposed a temporary ban on the account cryptocurrency project BitConnect, according to which all the company’s assets were frozen. The decree was issued on Monday in the second lawsuit against the exchange and the platform for kreditirovanii.

According to the court, BitConnect required to report all of their cryptocurrency wallets and addresses of accounts used for trade, and to call all persons to whom defendants sent funds for the last 90 days.

The defendant is given 10 days to comply with the court order. In addition, BitConnect International PLC, BitConnect LTD, BitConnect Trading LTD and Ryan Massena prohibited to transfer any assets that they may belong to, until they get permission of the court.

The court order followed after the second class action filed against Bitconnect, accused of using a fraudulent scheme at the closing of the exchange. Plaintiff Brian Paige from Kentucky claims that the money of all investors BitConnect in bitcoin and other cryptocurrencies were transferred to BitConnect Coin (BCC) at the closing of the exchange, when 1 BCC was worth about $300. At the time of publishing, the course of bitcoin is at $9.

The court found that the investors will have no chance to recover their funds, if the assets BitConnect will not be frozen, therefore, ruled “in the public interest because the public interest in preventing massive fraud and other violations of securities laws”.

In the court order says:

“The decree on temporary restriction of access to assets is issued without notice to defendant, to maintain the status quo and prevent irreparable harm until, until the court is ready to hold a hearing”.

Because of the nature of the case and the alleged violations, the court also noted that the plaintiff “has a high probability to succeed,” and the current resolution “will enable the court to render a meaningful decision on the case”.

A court order remains in effect until February 13.

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