- One Andrew Samuels filed a class action lawsuit against Lido DAO and venture capital investors in the organization.
- He believes that retail LDO holders have no real power to manage the project.
- The lawsuit also states that the token is a security. Consequently, large institutional holders are responsible for financial losses.
Investor Andrew Samuels files a class action lawsuit against the Lido DAO. In it, he stated that the LDO token is a security, and also held large contributors to the protocol responsible for the financial losses incurred.
In addition to Lido DAO, a number of venture capital companies are defendants in the lawsuit, namely: Paradigm, AH Capital Management, Dragonfly Digital Management and Robert Ventures
According to Samuels, at the launch of the project, 64% of all LDO tokens were controlled by institutional investors. This deprived him, as well as other Lido DAO participants, of the right to participate in the management of the platform.
At the same time, retail investors in the project suffered losses as a result of the LDO rate drawdown. Samuels believes that the above-mentioned counterparties are responsible for these losses.
He classified the token as a security on the basis that its purchase by retail investors was motivated by an expectation of profit, the lawsuit says.
As a reminder, Lido DAO is a decentralized organization that manages the Ethereum liquid staking protocol. More about this here:
Since the beginning of 2023, the LDO rate has increased by 117%, according to TradingView. However, the asset price is still below the ATH by 24%:
Курс LDO/USDT на бирже Binance. Source: TradingViewAt the beginning of December 2023, the volume of locked assets (TVL) in smart contracts of the protocol reached an all-time high.