News Envion Shut Down By Swiss Court In Wake Of...

Envion Shut Down By Swiss Court In Wake Of Company In-Fighting

-

- Advertisment -

November 30, 2018 9:52 PM

Legal drama between partners spoiled a unique take on eco-friendly crypto mining.

For a company that combined aspects of the crypto mining and renewable energy industries, Envion AG was anything but put together. After a successful ICO that raised $100 million, an investigation by the Swiss Financial Market Supervisory Authority (FINMA) and a sweep of suits and countersuits between founders Michael Luckow and Matthias Woestmann led to a court in Zug, Switzerland, shutting down the firm and ordering its liquidation.

According to German news outlet Handelsblatt, in its decision to shut down the company, the Swiss court cited Envion’s complete lack of any auditing function and a nonexistent board of directors after Woestmann resigned as board chairman, among other unnamed reasons.

Out of the Solar-Powered Frying Pan and into the Fire

The idea behind Envion’s project was to load up cryptocurrency mining rigs in shipping containers and transport them to wherever power was cheap across the globe. The containers were dubbed mobile mining units and they were to be placed near solar and wind farms or fossil fuel-driven power plants. In return, those farms and plants would sell their over-capacities back to the firm to run their mining units. Envion predicted a 161 percent return on investments per year.

After launching the company in early 2017, Luckow brought on Woestmann to be Envion’s CEO in October, giving him a 19 percent stake in the company. By January 2018, the Envion ICO had raised $100 million, but Woestmann had pushed through a capital increase and issued actual shares to investor Thomas van Aubel (a German lawyer), rather than tokens, which diluted Luckow’s 81 percent stake to 33 percent.

Woestmann removed Luckow’s name from the company’s team page on the Envion website, which spurred Luckow and other founding members to launch their own blog, where they reached out to their investors directly through a series of posts and video updates.

By May 2018, Woestmann claimed Luckow and founding members fraudulently created 20 million additional tokens to enrich themselves without the knowledge of the board. Because of this, Woestmann planned to take full control of the company, an action Luckow’s blog referred to as the “world’s first analogue ICO hacking.”

Ultimately, by July 2018, FINMA announced that it had started “enforcement proceedings” against Envion. The regulator explained:

“Investigations carried out by FINMA to date indicate that, in the context of its ICO, envion AG accepted funds amounting to approximately one hundred million francs from more than 30,000 investors in return for issuing EVN tokens in a bond-like form.”

The court has advised investors who participated in the ICO to verify their identities and file claims with the bankruptcy office or risk not being considered in the dissolution and bankruptcy proceedings. These claims, according to the report, must be filed within a month of the decision, or the investors may end up forfeiting their investments.

Nicholas Ruggieri studied English with an emphasis in creative writing at the University of Nevada, Reno. When he’s not quoting Vines at anyone who’s willing to listen, you’ll find him listening to too many podcasts, reading too many books, and crocheting too many sweaters for his dogs, RT and Peterman.

ETHNews is committed to its Editorial Policy

Like what you read? Follow us on Twitter @ETHNews_ to receive the latest Envion, FINMA or other Ethereum law and legislation news.



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Use of Smart Cards in Blockchain App Development

Ever since blockchain technology made a major breakthrough all over the globe, experts and forecasters have been...

IMF: Risk of substitution of domestic money by central banks’ digital currencies

Central banks around the world began looking closely at the issuance of their own digital currencies, known...

Ripple: The cryptocurrency that will ‘change’ the world in 2020

Ripple could say he's a child of Bitcoin: In December 2017 Bitcoin hit a record price in...

Spain approves Crypto Holdings disclosure bill from cryptocurrency holders

Spain approves Crypto Holdings disclosure bill from cryptocurrency holders. Spain's government has reportedly approved...
- Advertisement -

CryptoTaxCalculator Partners With CoinSpot

Australia’s leading cryptocurrency exchange CoinSpot has partnered with Australian made CryptoTaxCalculator to help users deal with the...

Will Cryptocurrency Survive in 2021?

The million dollar question: ''Will Cryptocurrency Survive in 2021''? Should you keep investing?

Must read

Use of Smart Cards in Blockchain App Development

Ever since blockchain technology made a major...
- Advertisement -

Read Next
Recommended to you