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Lawsuit accuses Mark Cuban of tricking investors with crypto ‘Ponzi scheme’

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Lawsuit accuses Mark Cuban of tricking investors with crypto ‘Ponzi scheme’

A new lawsuit accuses the billionaire shark tank investor Mark Cuban to team up with now-bankrupt crypto platform Voyager Digital to dupe investors into “a massive Ponzi scheme.”

A class action lawsuit filed Wednesday on behalf of millions of investors alleges that 3.5 million Americans lost more than $5 billion in cryptocurrency assets through Voyager. He says the program depended on vocal and financial support from Cuba.

Voyager CEO Stephen Ehrlich and the Dallas Mavericks, the Cuban-owned NBA team, are also listed as defendants. The lawsuit says Cuban, Ehrlich and the Mavericks should reimburse the victims.

“Cuban and Ehrlich, as will be explained, went to great lengths to use their experience as investors to dupe millions of Americans into investing — in many cases, their life savings,” the lawsuit said.

Cuban did not immediately return a request for comment on the lawsuit.

The Mavericks first announced an exclusive five-year partnership with Voyager in October 2021. Fans received a limited deal where if they deposited $100 and traded at least $10 by the end of the month, they got a $100 reward. The influx of new users was so great that Voyager added a waiting list.

The partnership announcement of the Mavericks said Voyager was a way “to get high returns while getting in-game skin”. He also said it was “an attractive investment for novice investors who might only have $100 to get started.”

Voyager temporarily suspended all trading and withdrawals on its platform on July 1 shortly before filing for bankruptcy in New York on July 5, listing both assets and liabilities between $1 billion and $10 billion.

Shares of Voyager Digital have fallen more than 98% in the past year to under $1. The company token, VGXis down more than 90% for the same period.

The timing of the partnership was not ideal. It launched last October, just weeks before digital currencies peaked in November before crashing. Since early November, the global market capitalization of cryptocurrencies fell from $2.9 trillion to $1.2 trillion.

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