A contentious legal dispute is emerging, casting two prominent figures, Roger Ver and Jihan Wu, into a legal battle. The heart of the matter revolves around an $8 million sum that ‘Bitcoin Jesus’ Ver alleges Wu appropriated as a form of retribution. Ver’s purported involvement in the collapse of a different cryptocurrency exchange, CoinFLEX, is at the core of this dispute. Last year, Ver initiated a legal action in Seychelles, directing his focus towards Matrixport’s subsidiary, Smart Vega, which operates Bit.com.
The lawsuit contends that Bit.com has retained the $8 million, allegedly at the behest of Jihan Wu, who is a creditor of CoinFLEX. Wu’s financial losses, stemming from CoinFLEX’s restructuring, were the trigger for the alleged withholding of Ver’s funds.
The Legal Dispute
Bitcoin Jesus’ legal representatives commenced legal proceedings against Smart Vega Holding Limited, a Matrixport subsidiary, in August 2022. Their aim was to recover the $8 million that Ver was unable to withdraw from Bit.com. This issue came to light during the crypto industry’s tumultuous period, known as the crypto credit crunch, which unfolded last year. Ver asserts that Jihan Wu inappropriately intertwined personal interests with the matters of the defendant, consequently preventing the release of his funds.
The basis for this prevention rested on Wu’s belief that Ver owed sums to a third party, who, in turn, owed sums to Wu. Ver explicitly stated in an affidavit submitted to the Supreme Court of the Seychelles in September 2022, “The reason my funds were unavailable for withdrawal was because Wu had instructed Respondent not to release them to me. Wu had done so because he believed I owed sums to a third party who owed sums to him. His belief was both false and irrelevant.”
Matrixport provides a contrasting interpretation of the situation. According to a company spokesperson, Roger Ver is a customer of Bit.com. The issue at hand arises from an investigation into Ver’s irregularities in margin trading on Bit.com. The outcome of the investigation pointed to Ver’s breach of contractual obligations. While Ver was subject to a penalty fee for defaults in the margin call, he retained the liberty to withdraw his funds. Instead, he chose to contest the penalties imposed.
Ongoing Challenges for CoinFLEX
The ongoing legal turmoil is further complicated by the persisting issues surrounding CoinFLEX. The exchange initiated restructuring proceedings in August 2022, following a public dispute with Roger Ver. CoinFLEX accused its former investor of failing to meet an $84 million debt owed to the company. Just recently, creditors of CoinFLEX alleged that Mark Lamb, the previous owner of the exchange, had redirected resources and had gone missing. They have filed a lawsuit against Lamb, asserting that he had settled his debt with Roger Ver earlier this year. The creditors of CoinFLEX are now embarking on a legal path to recover their investments from Ver.
The legal dispute between Bitcoin Jesus and Matrixport, particularly involving Jihan Wu, shines a spotlight on the intricate challenges within the crypto domain. As the case unfolds, it underscores the necessity for well-defined contractual obligations. This is because of the complexities that can arise when personal interests intersect with business transactions. The ongoing crisis surrounding CoinFLEX further emphasizes the volatile and uncertain nature of the cryptocurrency realm.