Mark Cuban faces class action lawsuit for promoting Voyager crypto products

Mark Cuban, the billionaire entrepreneur who has been quite active in the crypto ecosystem for the past year, is facing a class action lawsuit over his promotions of the bankrupt crypto brokerage firm Voyager Digital.

Law firm Moskowitz archived a civil suit in the United States District Court in South Florida against Cubans for promoting Voyager’s unregulated crypto products. The trial required a jury trial for the case.

The lawsuit alleged that Cuban also misrepresented the firm on several occasions, making dubious claims that it was cheaper than competitors and offered “commission-free” trading services. Cuban, along with Voyager Digital CEO Stephen Ehrlich, leveraged their years of experience to lure inexperienced customers into investing their savings in what they called a Ponzi scheme, the lawsuit alleges.

An excerpt from the lawsuit read:

“Cuban and Ehrlich, went to great lengths to use their experience as investors to trick millions of Americans into investing – in many cases their life savings – in the Deceptive Voyager Platform and purchasing Voyager Earn Program Accounts (‘EPAs’), which are unregistered securities.”

The lawsuit further alleged that Cuban continued to hype Voyager’s products and push retail investors to invest in it despite knowing it. Cuban went on to call the Voyager platform “as close to risk-free as you’re going to get in crypto.” The trial read:

“The Voyager platform relied on Cuban and the Dallas Mavericks’ vocal support and Cuban’s monetary investment to continue to sustain itself until its implosion and Voyager’s subsequent bankruptcy.”

Voyager was one of many crypto borrowers of Three Arrows Capital (3AC) that went bankrupt after later insolvency. The crypto lending firm halted trading activity and withdrawals on July 1st and eventually filed for Chapter 11 bankruptcy on July 5th. Currently, over 3.5 million US customers have nearly $5 billion in cryptocurrency assets on the platform that is frozen.

Related: Voyager Digital reportedly had deep ties to SBF-owned Alameda Research

Voyager was cleared to return $270 million in customer funds held at Metropolitan Commercial Bank (MCB) by the judge presiding over the bankruptcy proceedings in New York. A day later, the lending firm announced that customers with US dollars in their accounts could withdraw up to $100,000 in a 24-hour period starting as early as August 11, with the funds received within 5–10 business days.