Alameda Research Files Lawsuit Against Waves Founder for $90 Million Recovery
Alameda Research, linked to the now-defunct FTX exchange, has filed a lawsuit against Aleksandr Ivanov, founder of the Waves blockchain, seeking approximately $90 million. This action is part of Alameda's efforts to recover assets and repay creditors after FTX's 2022 collapse.
Allegations Against Ivanov
The lawsuit, filed on Sunday, accuses Ivanov and his companies, Numeris Ltd. and DLTech Ltd., of fraudulent practices leading to substantial financial losses for Alameda. Alameda claims it deposited about $80 million in stablecoins into Vires.Finance, a liquidity platform within the Waves ecosystem, but these funds are now inaccessible due to what it describes as Ivanov's mismanagement and deceptive activities.
WAVES Token Manipulation
Alameda alleges that Ivanov executed transactions aimed at "artificially inflating" the value of the WAVES token. He allegedly diverted funds from Vires, resulting in a more than 95% decrease in the token's market value and contributing to a $530 million loss for Vires users. These actions are claimed to have been a strategy to temporarily boost WAVES value, leaving investors with significant losses when the price collapsed.
Public Manipulation Claims
The lawsuit also claims that Ivanov attempted to manipulate public perception by blaming Alameda for issues within the Waves network while privately extorting funds from them. Ivanov allegedly threatened to block Alameda's access to its funds unless financial support was provided to stabilize the Waves and Vires platforms. After Alameda declined, he reportedly restricted their access to the deposited assets through his authority within the Vires decentralized autonomous organization (DAO).
Frozen Assets and Legal Violations
In November 2022, Ivanov acknowledged Alameda's collateral deposit of approximately $90 million but allegedly froze these funds under the pretext of ensuring repayment to affected FTX users. Since then, Alameda claims that Ivanov has ignored attempts to negotiate asset recovery, leaving their funds locked.
The lawsuit seeks not only the recovery of frozen assets but also damages for alleged Bankruptcy Code violations, including fraud and conversion of property. Alameda intends to explore all avenues to recover any additional assets acquired by Ivanov or his companies through these activities. The firm argues that Ivanov's actions complicate asset recovery efforts, particularly as he reportedly takes steps to dissolve the legal entities overseeing Waves and Vires, raising concerns about accountability.
Broader Implications
This case underscores Alameda Research's initiative to recover assets for creditors affected by FTX's failure. The lawsuit may be modified as new information arises, indicating potential expansion of legal claims. Alameda's legal team emphasizes its commitment to pursuing asset recovery and compensation for creditors.
As the lawsuit progresses, Ivanov has yet to publicly address these allegations. This case highlights challenges in asset recovery within the cryptocurrency sector, especially regarding decentralized platforms, which may influence future handling of similar cases.
Potential Industry Impact
By filing this lawsuit, Alameda Research aims to establish accountability within the cryptocurrency ecosystem. The case could prompt increased scrutiny of blockchain operations like Waves and emphasizes the necessity for transparency and legal clarity in managing digital assets amidst growing interest in DeFi. The outcome may encourage other companies to pursue similar claims if they suspect fraud or mismanagement.