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Traders file a lawsuit against cryptocurrency exchange startup Kraken

05 July 2017 21:00, UTC

According to Сoindesk.com, five plaintiffs from the UK, the US and Israel filed lawsuits against Payward Inc, more known as cryptocurrency exchange startup Kraken.

The reasons for lawsuits against Kraken are traders’ losses after a denial-of-service (DDoS) attack on the exchange website and subsequent unfair cryptocurrency sale or alleged manipulation, which, according to the plaintiffs, resulted in loss. The total damage claimed by the five plaintiffs is 3,414,078 ETH or $329,000 at a price of $96.32. The amount was equal to about $911,000 as from the announcement date.

The price of ethereum touched a low of $26 resulting in wave of liquidations. The customers of the exchange are alleging negligence, breach of contract and unjust enrichment arguing that Kraken should have suspended trading at the moment of the attack.

In turn, Kraken representatives stated that an internal investigation did not find any evidence of a coordinated attack or market manipulation and that its internal systems had operated normally. Also Kraken said that it would not compensate traders for losses of naturally occurring events in the market, nor losses due to unavoidable DDoS attacks.

The Florida-based Silver Law Group, one of the companies that filed the lawsuit on behalf of the plaintiffs, was involved in lawsuits filed against the now-defunct exchange Cryptsy and digital currency Coinbase. The plaintiffs claim compensation for the loss from the exchange, compensation for legal fees, as well as certification for class-action status.