Coinseed Announces Closure After Unauthorized Token Swapping
Main page News, US Market, scam, Crypto Market, Regulations

Cryptocurrency saving app Coinseed, which has been accused of switching users' funds to dogecoin (DOGE) without their consent, has announced closure due to a lawsuit from the New York Attorney General (NYAG). According to Coinseed Founder and CEO, Delgerdalai Davaasambuu, the NYAG office decided to set a "precedent of using the infamous Martin Act on crypto companies using Coinseed."

Subscribe to our Telegram channel to stay up to date on the latest crypto and blockchain news.

"The Martin Act is an outrageous State Law which gives the New York Attorney General almost unlimited power to subpoena and investigate companies in NY even if there were no complaints against them. And an even crazier thing is that we cannot even disclose the subpoena. It has to be a secret. See, everything should have been fine if we were not in NY," Davaasambuu claimed.

Davaasambuu's decision to close the website comes after New York Attorney General, Letitia James, filed a motion asking the court to "immediately block Coinseed" and its Chief Executive, Delgerdalai Davaasambuu, from making any further "unauthorized trades and safeguarding investors’ monies."

James emphasized that the greed perpetrated by Coinseed and its CEO has grown despite the fact the NYAG filed the case against Coinseed and its executives several months ago.

Crypto Startup Coinseed is Accused of Defrauding $1M

As iHodl earlier reported, approximately 50 clients of Coinseed planned to file a class action lawsuit against the company after Coinseed converted their funds to DOGE without their consent. In addition, users in a Facebook group also claim to have suffered large losses due to the company's actions and claim that some of the app's features were unavailable.

Later, Jason Gottlieb, a partner of Coinseed's lawyer Morrison Cohen, announced that the law firm would not defend the interests of the company as the platform's leaders had reportedly left the US.

Access more than 50 of the world's financial markets directly from your EXANTE account – including NASDAQ, London Stock Exchange and Tokyo Stock Exchange.

Read also:
Please describe the error