According to a lawsuit filed by investors Alec & Artin Ohanian in the California Central District Court, the Stablegains platform misled its customers and sought to profit at the expense of users. Plaintiffs Allege Stablegains Transferred User Funds to Anchor Protocol Without Their Knowledge or Consent. This protocol offered investors a 20% return on the TerraUSD (UST) algorithmic stablecoin, while Stablegains offered users a 15% return on Anchor Protocol earnings.. This means that Stablegains benefited from the difference in income from their transactions with Anchor Protocol, the authors of the lawsuit allege.
Plaintiffs Allege Stablegains Violated Federal Securities Laws. The platform management knew that UST and the LUNA coin were unregistered securities, however, this information was not disclosed to clients, Ohanyan investors are sure. On the contrary, Stablegains promoted these crypto assets, advertising them as safe investments, the plaintiffs are outraged.. The lawsuit also mentions that Stablegains did not register with the US Securities and Exchange Commission (SEC) as a securities trading platform or broker-dealer.
The Ohanyans' claim is that the platform failed to protect investors' funds from the fall of the Terra ecosystem. Instead, Stablegains has attempted to hide its interaction with UST by removing all promotional material and security information from its website.
Last year, in the wake of Terra's May default, the New York City Attorney's Office urged crypto clients to report any irregularities on crypto lending platforms, including Stablegains.