DigitalX provides update on ICO litigation in Australia

Maria Nikolova

The company says it has received a request for mediation from the plaintiffs in a $1.83 million case.

Blockchain-based solutions provider and ICO adviser DigitalX Ltd (ASX:DCC) has earlier today provided an update on legal proceedings that it has to deal with in Australia.

Let’s recall that, in late September, the company confirmed it faced a legal claim related to an initial coin offering (ICO) to which it was an advisor. DigitalX said back then that it had been served with an Originating Application and Statement of Claim in the Federal Court of Australia filed by a group of parties relating to an investment made by those parties in an initial coin offering to which DigitalX was an advisor.

DigitalX commented:

“While the company and its legal advisors continue to review and examine the claims made, the company denies any claim of wrongdoing, and for reasons that will become apparent as this matter progresses, believes that it has strong grounds to defend any claims brought forward by these applicants. As such, the company intends to vigorously defend this matter and protect the reputation of the company”.

The claim is for a combined amount of approximately US$1.83 million plus damages.

Today, DigitalX says it has received a request for mediation from the other parties and continue to vigorously defend their claims which the company believes have no basis. The company notes that it will update the market with further information when it is available.

Australian regulators have adopted a cautious stance regarding ICOs and cryptocurrencies. In April this year, for example, Australian Securities and Investments Commission (ASIC) Commissioner John Price noted that the regulator is determined to see Australia’s innovative fintech and regtech flourish in the right regulatory environment but he stressed that “ASIC must be focused on both protecting Australian consumers and facilitating innovation across the financial services industry”.

”Regardless of the structure, however, there is one law that will always apply – you can’t make misleading or deceptive statements about the product. This is going to be a key focus for us going forward”, John Price said.

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