Bitstamp and Gatehub Settle $ 4.9 Million Dispute With Client Over Bitcoin Trading Losses
The crypto platform Gatehub and the Bitstamp exchange agreed to begin the process of resolving a dispute with a client who sued them for $ 4.9 million due to losses he suffered while trading bitcoin using the services they provide, writes Law360.
Salim Satir, referred to as a bodybuilding coach, claims he was misled about the nature of the services offered. In addition, according to him, he was not allowed to withdraw bitcoins during volatile periods in the market, which caused the loss of several million dollars..
Gatehub previously denied limiting trading activity on Satir’s account. The company said that the only service the plaintiff used was to get free access to his wallet in the Ripple registry. Satyr claims information on the company’s website made him think he could use it to exchange XRP for Bitcoin.
Gatehub, for its part, insists that its terms of service clearly state that it is neither an intermediary nor a broker, and all transactions are conducted in the XRP distributed ledger. The company also claims that the client did not bother to get acquainted with the nature of the service provided, but agreed to all the conditions.
Satyr established a “trust line” with Bitstamp through the Gatehub interface to buy Bitcoin IOUs from other market participants through the Ripple ledger issued by Bitstamp. The IOUs were not a physical token, but a promise to extinguish the client’s claim with the appropriate amount of bitcoins upon request, the defense says.
Gatehub also denied Satir’s claims that he could not move tokens from December 2017 to January 2018 due to a prolonged technical glitch. According to the plaintiff, as a result of the impossibility of withdrawing 872 BTC and the market volatility, he suffered large losses. While he was trying to carry out actions on the platform, the price of bitcoin dropped by $ 2,992.
Also, according to him, Gatehub held onto the Bitcoin Cash coins that were due to him after the hard fork in August 2017. The plaintiff’s representatives say the companies must pay him $ 2.5 million for the delay in the transfer of the cryptocurrency and $ 2.4 million for the undelivered Bitcoin Cash coins..
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