DeFi altcoin project PoolTogether held an NFT sale to fund its legal defense against an individual who invested $10 in the protocol and sued the company behind it for providing an “unauthorized lottery scheme” , raising more than $830,000 in five days. The price of altcoins rose following this news.
DeFi altcoin project sells $830,000 worth of NFTs
The crypto community has rallied behind DeFi app PoolTogether, helping it secure over $830,000 for its legal war chest. PoolTogether, one of Ethereum’s oldest DeFi protocols, has turned to NFTs to raise funds for its legal defense against a class action lawsuit that could set an undesirable precedent for the entire DeFi industry. With the impact of the news, the price of the altcoin rose from $1.42 to $1.60. At the time of writing, it was trading at $1.57, gaining 9% on a daily basis.
PoolTogether released the Pooly NFT Collection on Thursday with three NFTs available in price tiers of 0.1 ETH, 1 ETH, and 75 ETH. The collection has since raised 437.2 ETH, worth approximately $833,000 at current prices for legal war chest. The campaign has also received support from prominent voices in the crypto industry, including Uniswap creator Hayden Adams and Ryan Sean Adams and David Hoffman, co-founders of the popular podcast Bankless.
What is the charge against PoolTogether?
cryptocoin.com As reported in his news, last October, a Delaware software engineer and company named Joseph Kent, a former employee of anti-crypto Democratic Senator Elizabeth Warren, filed a class action lawsuit against PoolTogether Inc. in New State. York for allegedly activating an “unauthorized lottery program.” Kent deposited $10 worth of crypto into the protocol and later claimed that PoolTogether Inc. was running an illegal prize-based savings game at his New York residence.
PoolTogether co-founder Leighton Cusack, announcing the NFT crowdfunding campaign, said on Twitter that “the allegations are irrelevant, but a full defense is still needed.” In its defense, PoolTogether claims that its legal entity does not own or control the underlying smart contract-based protocol and only operates the interface that gives users access. He also argues that “lossless” deposits from the DeFi implementation cannot be considered lottery tickets.
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