TikTok Crypto Influencers Mislead Viewers

TikTok, the popular social media platform, has become a go-to source of information for many young people today. However, a recent study conducted by daapGamble reveals that over one-third of cryptocurrency influencers on TikTok are sharing unvetted misinformation about Bitcoin and other cryptocurrency investments. Many of these influencers are promoting crypto investments without properly warning viewers about the risks, convincing unwary investors to put their hard-earned money into cryptocurrencies that are likely to lose value.

The study analyzed 1,161 crypto-related videos on TikTok, which used the hashtag “#cryptok.” More than one in three of these videos were found to be misleading, while just one in ten videos contained some form of disclaimer about the risks of investing. Additionally, 47% of the crypto influencers were found to be pushing services for their own profit.

The potential financial risk for unwary investors is high, with one in three misleading videos on TikTok mentioning Bitcoin. Furthermore, videos using popular crypto-related hashtags, such as #crypto, #cryptoadvice, and #cryptoinvesting, have cumulatively garnered over 6 billion views. However, viewers often overlook the ill intent of influencers and trust their content purely based on its high number of views or likes.

The study found that both new and seasoned investors should do extensive research on crypto projects before making any form of investment. While the reach of crypto influencers is smaller than that of mainstream celebrities, such as Kim Kardashian, Jake Paul, and Soulja Boy, the potential financial risks for unwary investors remains equally high.

In recent years, many mainstream influencers have been accused of promoting cryptocurrencies to their millions of fans without disclosing the payments they received. For instance, the United States Securities and Exchange Commission forced Kim Kardashian to pay $1.26 million in penalties for promoting EthereumMax (EMAX).

In April 2022, a $1 billion lawsuit was filed against crypto exchange Binance, CEO Changpeng Zhao, and three crypto influencers for allegedly promoting unregistered securities. The Moscowitz Law Firm and Boies Schiller Flexner, who filed the lawsuit, called this a classic example of a centralized exchange promoting the sale of an unregistered security.

In conclusion, while TikTok can be an excellent source of information, viewers are advised to exercise caution when it comes to crypto influencers and do their own research before making any investments.

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AI Companies Respond to Copyright Infringement Claims

On April 18, Stability AI, Midjourney, and DeviantArt issued a response to a lawsuit brought by artists who accused the companies of extensive copyright infringement. The artists claimed that their work was used without permission to train generative AI systems, and that the resulting AI-generated images, created in their styles, were also infringing. The companies filed motions seeking the dismissal of the proposed class-action lawsuit, arguing that the AI-generated images were dissimilar to the artists’ work and that the lawsuit lacked specific information about the allegedly misused photos.

Stability AI, a deep learning, text-to-image model AI company, argued in their filing that the artists “fail to identify a single allegedly infringing output image, let alone one that is substantially similar to any of their copyrighted works.” Midjourney, an AI company that generates images from natural language descriptions, similarly argued that the lawsuit did not “identify a single work by any plaintiff” that it “supposedly used as training data.” DeviantArt, an online community for artists that offers a service enabling users to generate images using Stability AI’s Stable Diffusion system, supported the same arguments as Stability AI, and claimed that it was not responsible for any alleged wrongdoing by the AI companies.

The artists, Sarah Andersen, Kelly McKernan, and Karla Ortiz, filed the lawsuit in January, claiming that their rights had been violated. In accordance with United States case law, copyright holders can establish that the outputs produced by an AI program infringe upon their copyright if the program had access to their works and the resulting outputs are deemed “substantially similar.” The artists alleged that their works were used without permission to train the AI systems, and that the resulting outputs were infringing.

Recent innovations in AI are raising new questions about how copyright law principles such as authorship, infringement, and fair use will apply to content created or used by AI. Generative AI computer programs such as Stability AI’s Stable Diffusion program and Midjourney’s self-titled program are able to generate new images, texts, and other content or outputs in response to a user’s textual prompts or inputs. These generative AI programs are trained to generate such works partly by exposing them to large quantities of existing works such as writings, photos, paintings, and other artworks.

While the use of AI to generate new content offers exciting possibilities, it also raises important legal questions. As AI systems become more sophisticated and capable of generating outputs that resemble existing works, copyright holders may face new challenges in protecting their intellectual property rights. At the same time, AI companies will need to navigate complex legal terrain in order to avoid infringing upon existing copyrights. As the legal landscape evolves, it will be important for artists, AI developers, and legal professionals to work together to establish clear guidelines for the use of AI in creative endeavors.

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NFT Co-Founder Faces Lawsuit Over Crypto Wallet Dispute

The world of nonfungible tokens (NFTs) has been rocked by a lawsuit that has been filed against one of the co-founders of the Rebase project, Edmond Truong. The lawsuit has been brought by Krzysztof Gagacki, who claims to be a co-founder of the project and alleges that Truong has acted in bad faith by misappropriating $2 million into a separate wallet that is owned and controlled by him without Gagacki’s consent.

In the filing, which was made on April 17, 2023, in a United States District Court in California, Gagacki accuses Truong of eight separate complaints, including breach of contract, breach of fiduciary duty, defamation, and trademark infringement. He is demanding a jury trial, claiming that Truong has “gone rogue” by stealing money from a joint crypto wallet and ousting Gagacki from the firm.

According to Gagacki, the professional relationship between the two had deteriorated by October 27, 2022, when Truong breached their partnership contract. Gagacki claims that he owns a 50% share of the funds in the joint crypto wallet but that Truong refuses to provide him with the private keys to the digital wallet.

Gagacki further alleges that Truong has “ousted” him from the business by presenting himself as the “sole owner” and “decision maker” for Rebase. He claims that Truong has made several defamatory statements to the firm’s business contacts about him, causing damage to his reputation.

Furthermore, Gagacki claims that Truong has intentionally interfered with several prospective deals that he had been working on for the firm. One of these deals involved American celebrity Bella Hadid, who featured in the firm’s Cy-B3lla NFT project. The filing alleges that Hadid refused further collaboration with the project after it was made apparent to her that the two co-founders had clashed.

It is unclear when the professional relationship between Truong and Gagacki started to deteriorate, but Gagacki claims that Truong has been acting in bad faith by misappropriating funds and making defamatory statements about him. The lawsuit is expected to be closely watched by the NFT community, which has seen explosive growth in recent years. As the use of NFTs continues to expand into different industries, legal disputes like this one could become more common.

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XRP Not a Security According to Hogan

Jeremy Hogan, a lawyer at the legal firm Hogan & Hogan, has recently declared in a series of tweets that the digital asset known as XRP, which is owned by Ripple, is not a security since it does not meet the criteria for what is known as a “investment contract.” Hogan contends that the United States Securities and Exchange Commission (SEC) has not shown that Ripple is in violation of either an implicit or explicit investment contract in its action against the company. This is despite the fact that XRP might be regarded a security according to the definition of an investment contract.

Hogan notes that the SEC contends that the purchase agreement is all that is necessary to demonstrate that XRP is a security; nevertheless, this argument differentiates the “investment” from the “contract.” Hogan adds that the SEC contends that the purchase agreement is all that is required to demonstrate that XRP is a security. According to Hogan, a simple purchase cannot be considered a “investment contract” since there is no duty for Ripple to do anything other than transfer the asset. This is because there is no further consideration involved in the transaction.

The Securities and Exchange Commission (SEC) initiated legal action against Ripple in December 2020, alleging that the company unlawfully marketed unregistered securities in the form of its XRP coin. Ripple has long contested this allegation, stating that the Howey test, which is used to assess whether or not a transaction qualifies as an investment contract, does not apply to XRP. This test is used to establish whether or not a transaction qualifies as an investment contract.

Hogan further contends that each of the “blue sky” instances, which the Howey case relied on for defining an investment contract, featured some type of a contract pertaining to the investment, and that this was the case regardless of whether the case was decided in favor of the plaintiff or the defendant. According to Hogan, the most important question is not whether Ripple utilized the money from the sale of XRP to support its business, but rather whether the SEC has established that there was either an implicit or explicit “contract” between Ripple and XRP buyers pertaining to their “investment.” Hogan is of the view that the SEC has not proven that there was such a contract. As far as Hogan is concerned, there was never any such deal.

How the SEC will react to Hogan’s claims is something that has not yet been determined. On the other hand, his research offers a fresh point of view on the current legal struggle that is taking place between Ripple and the SEC. In the event that XRP is not regarded as a security, this development may have substantial repercussions for the direction that the cryptocurrency market is headed in the future.

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Sphere 3D Sues Gryphon Digital Mining Over Alleged Spoofing Attack

Sphere 3D has filed a lawsuit against its partner, Gryphon Digital Mining, over an alleged spoofing attack that led to the irregular transfer of Bitcoin. The complaint, filed on April 7, accuses Gryphon’s CEO, Rob Chang, of wiring 18 BTC to a fraudster posing as Sphere 3D’s chief financial officer in January. The lawsuit also claims that another eight Bitcoin were sent to the same address a few days later.

In a spoofing attack, an attacker falsifies data, such as IP addresses, email headers, or user credentials, to trick a system or a user into believing that they are someone else. This can give the attacker access to a system, sensitive information, or enable them to launch further attacks.

Sphere 3D CEO, Patricia Trompeter, said in a statement for investors that Gryphon had materially breached the Master Services Agreement (MSA) the companies had entered into. Trompeter accused Gryphon of “willfully violating their contractual duties” and putting Sphere 3D’s assets at significant risk.

According to the statement, Gryphon manages Sphere 3D’s “crypto mining activities” and maintains “fiduciary duties of Sphere’s digital assets.” In return for this work, Gryphon receives 22.5% of Sphere’s gross profit as payment.

The relationship between the companies, which were once considering a merger, appears to have deteriorated. Trompeter’s statement suggests that the lawsuit was filed because Sphere 3D would not be “bullied or threatened by the likes of Gryphon.” She added that Gryphon had failed to act with integrity and to honor their contract, and that Sphere 3D would hold them accountable.

Gryphon has not yet responded to the complaint. A spokesperson for the company said that they could not comment on pending litigation but were confident that their response to the complaint and the evidence that would come to light in the aftermath would speak for themselves.

The incident highlights the risks associated with spoofing attacks and the importance of maintaining robust security protocols. The outcome of the lawsuit will be closely watched by those in the cryptocurrency industry as it may have implications for how partners manage and secure digital assets.

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Crypto Miner Sphere 3D Sues Partner over Alleged Bitcoin Spoofing Attack

In a statement for investors, Sphere 3D CEO Patricia Trompeter announced that the company has filed a lawsuit against Gryphon Digital Mining, its partner in charge of managing its crypto mining activities and maintaining the fiduciary duties of Sphere’s digital assets. According to Trompeter, Gryphon has materially breached the Master Services Agreement (MSA) the two companies entered into, and has put the company’s assets at significant risk.

The lawsuit stems from an alleged spoofing attack that occurred on January 18, 2022. The complaint alleges that Gryphon CEO Rob Chang wired BTC to a fraudster posing as Sphere 3D’s chief financial officer. The complaint also states that another eight Bitcoin were sent to the same address a few days later. A spoofing attack occurs when an attacker attempts to trick a system or user into believing that they are someone else through falsifying data, such as IP addresses, email headers, or user credentials, to gain access to a system, steal sensitive information, or launch further attacks.

Sphere 3D and Gryphon Digital Mining have been partners since August 2021. Gryphon is responsible for managing Sphere 3D’s crypto mining activities and maintaining the fiduciary duties of Sphere’s digital assets. In return, Gryphon receives 22.5% of Sphere’s gross profit.

The relationship between the two companies appears to have deteriorated significantly. Trompeter’s statement suggests that the companies were once considering a merger. She also noted that the filing demonstrates that Sphere 3D will not be bullied or threatened by Gryphon. Trompeter stated that Gryphon has failed to act with integrity, failed to honor their contract, and that Sphere 3D will hold them accountable.

In conclusion, the lawsuit filed by Sphere 3D against Gryphon Digital Mining highlights the risks associated with the custody and management of digital assets. Spoofing attacks are a significant threat to the security of digital assets, and companies must take proactive steps to protect themselves and their clients from such attacks. As the crypto industry continues to evolve and grow, the need for robust security measures and contractual agreements that protect both parties will become increasingly important.

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Musk Requests Dismissal of $258 Billion Dogecoin Pyramid Scheme Lawsuit

Elon Musk, the billionaire entrepreneur and CEO of SpaceX and Tesla, is facing a $258 billion lawsuit accusing him of operating a pyramid scheme to promote the popular cryptocurrency Dogecoin (DOGE). However, Musk and his legal team are now pushing to have the lawsuit dismissed, stating that the allegations are baseless and lacking in evidence.

The lawsuit was filed by a group of Dogecoin investors in June 2022, who claimed that Musk had used his enormous social media influence to artificially inflate the price of DOGE, causing them to suffer significant financial losses when the cryptocurrency’s value subsequently plummeted. The investors also accused Musk of manipulating the cryptocurrency market to his own advantage, calling his actions a “dogecoin hustle.”

However, according to a Reuters report from April 1, Musk’s lawyers have now requested that the lawsuit be dismissed on the grounds that it is a “fanciful work of fiction” with no factual basis. The hearing took place on March 31 in Manhattan’s federal court, where Musk’s legal team argued that the investors’ claims were entirely without merit and should be thrown out.

This is not the first time that Musk has faced legal action related to his involvement with cryptocurrencies. In 2018, the US Securities and Exchange Commission (SEC) fined him $20 million for allegedly misleading investors with tweets about taking Tesla private. The SEC also required Musk to step down as the chairman of Tesla’s board of directors.

Despite the legal challenges, Musk remains a high-profile figure in the world of cryptocurrencies, and his social media posts about DOGE and other digital assets continue to garner significant attention from both fans and detractors alike.

In recent years, Musk has publicly expressed his support for cryptocurrencies, particularly DOGE, which he has referred to as “the people’s crypto.” However, his statements have also been criticized for their potential to influence the market and create volatility.

Despite the controversy surrounding Musk’s involvement with cryptocurrencies, many investors and traders remain bullish on DOGE and other digital assets, viewing them as a potentially lucrative investment opportunity. Whether the lawsuit against Musk will ultimately be successful remains to be seen, but it is clear that the world of cryptocurrencies continues to be a hotbed of legal and regulatory challenges.

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Binance faces investor backlash and Bitcoin withdrawals following CFTC lawsuit

The United States Commodity Futures Trading Commission (CFTC) recently filed a lawsuit against Binance, one of the world’s largest cryptocurrency exchanges, and its CEO, Changpeng “CZ” Zhao, for alleged regulatory violations. In response to the allegations, CZ denied any market manipulation by Binance, but investors were quick to respond with a significant move of assets away from the exchange.

Within 24 hours of the lawsuit announcement, investors withdrew over 3,400 BTC from Binance, anticipating market fluctuations and seeking to lessen the potential impact of a Binance shutdown. The move by investors led to a reduction in Binance’s total Bitcoin balance, which was reduced by over 3,900 BTC in the past week. In contrast, competing exchanges such as Coinbase, Bitfinex, and Gemini saw an increase in BTC reserves during the same 24-hour timeframe.

While CZ maintains that Binance does not trade for profit or manipulate the market, recent episodes involving other crypto entrepreneurs, such as FTX’s Sam Bankman-Fried and Terraform Labs’ Do Kwon, have shaken investor confidence in the cryptocurrency ecosystem.

It is also worth noting that Bitcoin balances on major crypto exchanges have declined since March 20, with nearly 27,000 BTC leaving these exchanges over the past week. The reasons behind this trend are not entirely clear, but it may be due to a combination of factors, including increasing regulatory scrutiny and concerns about the overall cryptocurrency market.

Alongside the CFTC’s lawsuit against Binance and CZ, a federal judge temporarily halted a proposed deal between Voyager and Binance.US. This move indicates that regulators are taking a closer look at the cryptocurrency industry and may be ramping up their efforts to enforce existing regulations and prevent fraudulent activities.

Overall, the recent events surrounding Binance and the wider cryptocurrency market have raised concerns among investors and regulators alike. While the long-term impact of these developments remains to be seen, it is clear that the cryptocurrency industry is facing increased scrutiny and may need to adapt to evolving regulatory requirements to continue its growth and development.

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Twitter Sued Amid Musk’s Plans to Lay Off 50% of Employees

Elon Musk might be the new owner of the social media giant, Twitter Inc, but he sure isn’t getting off on the right footing.

LAWSUIT2.jpg

The company has recently been sued through a class action lawsuit that seeks to prohibit the firm from laying off over 50% of its staff as planned.

 

Rumors of impending staff retrenchment have always been a major fear since the negotiations leading to the completion of the $44 billion company. According to several reports, Musk started firing the projected 3700 staff on Friday, a move that has drawn criticism from observers across the board.

The class action lawsuit was filed by Shannon Liss-Riordan, the attorney who also took Elon Musk and his electric automaker offshoot, Tesla Inc to court back in June when 10% of the workforce was laid off at the time. Though Liss-Riordan lost the suit at the time, she is confident that Musk cannot continue to thump his feet on the law everywhere he goes.

“We filed this lawsuit tonight in an attempt the make sure that employees are aware that they should not sign away their rights and that they have an avenue for pursuing their rights,” Shannon Liss-Riordan said in an interview.

Specifically, Elon Musk is being accused of breaking both California and Federal laws as the federal Worker Adjustment and Retraining Notification Act (WARN) Act demands that large companies be expected to give a 60-day notification in the case of a layoff. 

The lawsuit, filed in San Francisco demands that Musk and Twitter do the right thing while also preventing staff from signing documents that will make them give up their rights in civil litigation against the company.

As the renowned advocate of Dogecoin (DOGE), the prospect of the lawsuit as well as the rocky start to his tenure as owner of Twitter with ad customers pulling off the platform, the memecoin has derailed on its growth path, dropping by 4.37% to $0.1244, the only coin in the top 10 with a loss over the past 24 hours.

Image source: Shutterstock

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Twitter Sued Amid Musk’s Plans to Lay Off 50% of Employees

Elon Musk might be the new owner of the social media giant, Twitter Inc, but he sure isn’t getting off on the right footing.

LAWSUIT2.jpg

The company has recently been sued through a class action lawsuit that seeks to prohibit the firm from laying off over 50% of its staff as planned.

 

Rumors of impending staff retrenchment have always been a major fear since the negotiations leading to the completion of the $44 billion company. According to several reports, Musk started firing the projected 3700 staff on Friday, a move that has drawn criticism from observers across the board.

The class action lawsuit was filed by Shannon Liss-Riordan, the attorney who also took Elon Musk and his electric automaker offshoot, Tesla Inc to court back in June when 10% of the workforce was laid off at the time. Though Liss-Riordan lost the suit at the time, she is confident that Musk cannot continue to thump his feet on the law everywhere he goes.

“We filed this lawsuit tonight in an attempt the make sure that employees are aware that they should not sign away their rights and that they have an avenue for pursuing their rights,” Shannon Liss-Riordan said in an interview.

Specifically, Elon Musk is being accused of breaking both California and Federal laws as the federal Worker Adjustment and Retraining Notification Act (WARN) Act demands that large companies be expected to give a 60-day notification in the case of a layoff. 

The lawsuit, filed in San Francisco demands that Musk and Twitter do the right thing while also preventing staff from signing documents that will make them give up their rights in civil litigation against the company.

As the renowned advocate of Dogecoin (DOGE), the prospect of the lawsuit as well as the rocky start to his tenure as owner of Twitter with ad customers pulling off the platform, the memecoin has derailed on its growth path, dropping by 4.37% to $0.1244, the only coin in the top 10 with a loss over the past 24 hours.

Image source: Shutterstock

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