Texas-based Layer1 accused of misleading investors

The Texas-based mining company Layer1 misled investors about the amount raised and the composition of its founding team, according to Twitter industry insider BTCK555.

BOOM: @Layer1Official Lies & Misrepresentations covered by @wolfiezhao @Coindesk Wonder what investors @peterthiel @foundersfund @jacob @shasta @dcgco @winklevoss @winklevosscap think about this? https://t.co/8xiu6WPqNQ

— BTCKING555 (@btcking555) August 24, 2020

The company listed Canaan Creative founder Liu Xiangfu among its leadership. The Chinese entrepreneur denied this information.

Layer1’s CTO, Ivan Kirillov, the firm presented as a former lead engineer at Genesis Mining.

«Ivan was an external contractor and never worked at Genesis», — заявил Layer1’s CEO Alexander Ligl.

In October last year, media citing an investor presentation reported that Layer1 raised $50 million in a financing round with the participation of PayPal co-founder Peter Thiel and the Winklevoss brothers.

According to BnkToTheFuture, the company has raised a total of $41.39 million. In December 2018, in a seed round, Layer1 attracted $2.1 million.

«Layer1 never officially announced financing, however we know there is a regrettable misunderstanding about how much we raised», — заявил CEO of the firm Alexander Ligl.

Experts say that if any investors relied on the misleading presentation when making their decision, this could form the basis for litigation.

«Fudging the facts is fudging the facts. If an investor relied on this and incurred losses, they are likely to file a suit», — says the founder of the crypto-law firm Silver Miller, David Silver.

Earlier Layer1 signed a demand-response contract with a Texas electricity provider. The company agreed to curtail mining equipment on notice during peak load periods, freeing 100 MW of capacity for the grid. The total value of the agreement is estimated at $17 million per year.

Lancium, the owner of the technology that specialises in managing energy consumption, accused Layer1 of patent infringement for adopting the model.

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