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The law offices of Pomerantz LLP in New York have filed a series of civil suits against MGT Capital Investment and its executive officers on behalf of several of the trading firm’s past or present customers. The suits allege that between October 9, 2015 and September 7, 2018, the company violated laws set forth by the Securities Exchange Act of 1934 that resulted in damages to several of its clients.
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Between 2013 and April 2016, MGT described itself as “engaged in the business of acquiring, developing and monetizing social assets in the online and mobile gaming space, as well as the social casino industry.” In May 2016, however, the company revamped itself as a cybersecurity firm and developed bitcoin mining operations in both Washington state and Sweden. It was during this time that the company’s shares rose to some of their highest levels.

Stephen Schaeffer is the chief operating officer of MGT. Speaking with Bitcoin Magazine, he said that he believes any monetary losses suffered by clients are relative to the bearish conditions being witnessed in today’s crypto market.

“The bitcoin mining market has been tough,” he commented. “There’s no sugarcoating that. Our share prices exploded with the price of bitcoin, just as the difficulty rate for miners drastically increased. As bitcoin dropped, so did the value of our shares, but for miners, things got even worse because the difficulty rate stayed quite high. That means we’ve been spending considerably more in energy costs than we were last year.”

He continued, “I believe we hear too much redirect from miners on how great mining is and has been. Well, that’s true for a longer time frame. I have personally been mining since 2012 with an average monthly profit of

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