DWF Labs subsidiaries DWF Maas and Falcon Digital have sued cryptocurrency custodian BitGo in London's High Court, alleging a breach of token sale agreements. The lawsuit centers on claims that BitGo sold FF and ESPORTS tokens before agreed lock-up periods expired.
According to the subsidiaries, they agreed to sell the tokens to BitGo at a discount, with the condition that the digital assets remain locked for three months. DWF Maas, based in the British Virgin Islands, and Panama-based Falcon Digital claim BitGo moved the tokens to exchanges roughly two months before the first unlock date.
The token price movements cited in the case show FF fell from 8 cents at the start of the lock-up in early March to around 7 cents by late April. ESPORTS declined from approximately 28 cents in mid-March to 7 cents in early June.
DWF is seeking $114 million in damages, arguing that BitGo's early sales caused direct losses through the price declines in both tokens. Private token sales with lock-up periods are standard practice in the digital asset industry, designed to prevent immediate token dumping by buyers.
DWF said it raised the issue with BitGo in April and May before pursuing court action. The company stated that with no undertaking forthcoming from BitGo, legal action became necessary.
